Google Cloud revenues jumped 43% year over year during the second quarter of 2020. The cloud boost helped parent-company Alphabet beat Q2 expectations, but its advertising and search revenue took a pandemic-induced hit and Alphabet reported its first revenue decline in its history.

Google Cloud, which includes Google Cloud Platform (GCP) and G Suite tools, brought in $3 billion for Q2, compared to $2.1 billion a year ago and $2.77 billion last quarter. “The future of business will be more digital,” said Sundar Pichai, CEO of Google and Alphabet. “Customers are choosing Google Cloud to either lower their costs by improving operating efficiency, or to drive innovation through digital transformation,” he added, noting big customer wins during Q2 including Orange, Keurig Dr Pepper, Telefonica, and Deutsche Bank.

Despite Google Cloud’s growth, Q2 did prove to be a “difficult one” for Alphabet as Pichai and CFO Ruth Porat warned investors on the previous quarter’s earnings call. Alphabet’s total revenue declined 2% compared to the same quarter last year to $38.3 billion. “Year-on-year declines in our advertising revenues from search and network were offset by growth in Google other and Google Cloud revenues,” Porat said on the Q2 call.

Google advertising revenue brought in $29.9 billion during the quarter compared to $32.5 billion a year ago. Similarly, Google Search and other ad revenue (excluding YouTube), brought in $21.3 billion in Q2 2020, compared to $23.6 billion during the same period last year. Revenue from YouTube ads specifically, however, increased from $3.6 billion during the second quarter of 2019, to $3.8 billion this year.

The company did see gradual ad revenue improvement during the quarter, Porat said. “However, we believe it is premature to gauge the durability of recent trends given the obvious uncertainty of the global macro environment. As we discussed on last quarter’s earnings call, global macro-economic performance has tended to be correlated with ad spend and the key signal to monitor. Over the long term, we remain optimistic about the underlying strength of our business.”

Google Cloud, she added, gained traction with large customers singing “multi-year” deals. “This is reflected in the strength of our backlog, which ended the quarter at $14.8 billion, substantially all of which relates to Google Cloud. This performance is a result of the investments we’re making into the cloud-go-to-market organization.”

In late February, just weeks before much of the world went on lock down to try to slow the spread of COVID-19, Pichai said Google would invest more than $10 billion this year into offices and data centers in the U.S. He added that this investment would create “thousands of jobs.” This followed Google’s $13 billion investment in data centers and facilities in 2019.

In April, however, Pichai warned that the company would “significantly slow down the pace of hiring” for the rest of the year and reduce spending on data centers, machines, and non-essential marketing, and travel because of COVID-19.

Google’s earnings report followed that of cloud rival Microsoft, which last week reported slowed Azure cloud business growth. Microsoft reported that Azure revenues increased 47% year over year. However, that rate of growth was less than the 61% increase posted for its earlier quarter, which drew analyst concerns.

According to Synergy Research Group’s Q1 market share report, Google ranks third with 8% and Microsoft was second at 18%.

No. 1 cloud provider Amazon, which sat on 32% market share according to Synergy’s Q1 figures, also reported its Q2 earnings today and it handily beat expectations. Despite spending more than $4 billion in COVID-19-related costs, Amazon posted $88.9 billion in revenue, up 40% year over year.

Amazon Web Services’ revenue came in at $10.8 billion for Q2, up 29% year over year, but down slightly from the 33% growth it reported in Q1.