On Tuesday, Alphabet, the parent company of Google, reported robust revenue growth, showcasing its resilience amid stringent regulatory scrutiny and intensifying competition.

For the third quarter, Alphabet generated $88.3 billion in sales, a 15 percent increase from the previous year, surpassing analysts’ expectations of $86.4 billion. Profits soared by 34 percent, reaching $26.3 billion, exceeding the forecast of $22.9 billion.

These results highlight that Alphabet’s widely used online services, particularly Google’s search engine and YouTube, remain crucial platforms for advertisers aiming to reach consumers. The company has continued to yield substantial profits despite government pressure for potential breakups and heightened competition from TikTok, Amazon, and other rivals.

Shifting focus towards artificial intelligence, Alphabet is now competing with Microsoft and OpenAI for chatbot users, developers, and corporate clientele. In the third quarter, the company invested heavily in data centers, chips, and other hardware, with capital expenditures totaling $13 billion—a 62 percent increase from the previous year.

Sundar Pichai, Google’s CEO, stated in a call with financial analysts that the investment in AI is “paying off and driving success for the company.”

Following the announcement, Alphabet’s stock price rose over 5 percent in after-hours trading. The company also confirmed it would maintain a dividend of 20 cents per share for investors, payable on December 16.

Alphabet is currently facing two lawsuits from the Justice Department aimed at its influential online advertising business. In August, a federal judge ruled against Google, declaring that the company had operated as an illegal monopoly to preserve its dominance in the search market. The Justice Department is contemplating remedies, which may include requiring Google to divest its Chrome web browser and Android operating system.

Another ruling related to Google’s advertising technology for advertisers and publishers is anticipated soon. Government attorneys have proposed spinning off parts of Google’s ad business as a possible remedy, which Google denies as wrongful conduct in both cases.

Pichai reiterated on Tuesday that the company intends to “vigorously defend” itself against these allegations. He cautioned that some early proposals from the Justice Department could have far-reaching and unintended consequences, particularly for the dynamic tech sector and American leadership in technology.

Looking ahead, eMarketer forecasts that Google’s share of the search advertising market will dip below 50 percent next year as Amazon and TikTok ramp up their search ad sales. This would mark the first time since eMarketer began tracking this metric in 2008 that Google falls below this threshold.

Despite this, Google’s search engine, its primary revenue source, continues to thrive, with third-quarter revenue climbing 12 percent to $49.4 billion, slightly exceeding analysts’ predictions of $49 billion. This growth was attributed to increased spending on insurance and retail advertisements, as noted by Philipp Schindler, Google’s chief business officer.

YouTube also saw a 12 percent rise in advertising revenue, reaching $8.9 billion, aligning with analyst expectations, bolstered by election-related advertising.

Additionally, Google Cloud, which provides software and technology services to businesses, reported a 35 percent revenue increase to $11.4 billion, surpassing the anticipated $10.9 billion. This division achieved a record operating profit of $1.95 billion in the third quarter.