Alphabet has announced its first dividend and a $US70 billion ($A107 billion) stock buybuck, cheering investors who sent the stock surging nearly 16 per cent after the bell.
The Google parent is returning capital while spending billions of dollars on data centres to catch up with rivals on generative artificial intelligence. The dividend will be 20 cents per share.
Just three months ago, Alphabet's Big Tech rival, Meta Platforms, announced its own first dividend, a move that lifted the social media company's stock market value by $196 billion the following day.
Amazon.com remains the lone holdout among Big Tech firms not offering a dividend.
Alphabet beat expectations for the quarter in sales, profit and advertising - metrics that are all closely watched.
"Alphabet's announced dividend payouts and buybacks on top of the solid earnings beat are not only a breath of fresh air for the tech market as a whole, but also a very intelligent strategy for the search engine giant going into a tough time of the year," said Thomas Monteiro, senior analyst at Investing.com.
Alphabet's after-hours share surge of nearly 16 per cent following the report increased its stock market value by about $US300 billion ($A460 billion) to over $US2 trillion ($A3.1 trillion).
In a call to discuss results, CEO Sundar Pichai touted Google's AI offerings as a boon to its core search results.
"We are encouraged that we are seeing an increase in search usage among people who are using the AI overviews," he said on Thursday.
Revenue was $US80.54 billion for the quarter ended March 31, compared with estimates of $US78.59 billion, according to LSEG data.
The search firm's beat on first-quarter revenue was powered by rising demand for its cloud services on the back of increasing adoption of artificial intelligence and steady advertising spending.
Google reported advertising rose 13 per cent in the quarter to $US61.7 billion. That compares with the average estimate of $US60.2 billion, according to LSEG data.
Alphabet is coming off a fourth quarter in which ad sales missed the mark, sending shares tumbling, amid rising competition from Amazon.com, Facebook and new entrants like TikTok.
The latter faces an uncertain future after US President Joe Biden signed a bill that would ban the popular app if it is not sold within the next nine to 12 months.
Meanwhile, Google Cloud revenue grew 28 per cent in the first quarter, boosted by a boom in generative AI tools that rely on cloud services to deliver the technology to customers.
Google's cloud services are attractive for venture-capital backed startups developing generative AI technologies due to its pricing and ease of integration with other tools, investors and experts have previously said.