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Alphabet Class A (GOOGL)
NASDAQ:GOOGL
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Alphabet Class A (GOOGL) AI Stock Analysis

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Alphabet Class A

(NASDAQ:GOOGL)

Rating:85Outperform
Price Target:
$224.00
▲(17.07%Upside)
Alphabet's strong financial performance is the primary driver of its stock score, supported by robust revenue growth, profitability, and a solid balance sheet. Technical indicators show bullish momentum, while the valuation remains reasonable. The recent earnings call highlighted strong performance across key segments, with potential challenges noted but outweighed by strategic growth initiatives.
Positive Factors
AI Integration
AI integration is aiding monetization in search, which reduces the risk of revenue reset.
Earnings
Analyst expects strong results for Alphabet, with revenue and earnings per share anticipated above market expectations.
Negative Factors
Antitrust and Competition
The antitrust landscape is daunting, competition dynamic, and the macro treacherous.
DOJ Trial
The outcome of the Department of Justice search trial is anticipated to be a significant event, potentially affecting stock enthusiasm.

Alphabet Class A (GOOGL) vs. SPDR S&P 500 ETF (SPY)

Alphabet Class A Business Overview & Revenue Model

Company DescriptionAlphabet Inc. is a multinational conglomerate headquartered in Mountain View, California. It was created through a corporate restructuring of Google on October 2, 2015, and became the parent company of Google and several former Google subsidiaries. Alphabet operates in various sectors, including technology, life sciences, investment capital, and research and development. Its core products and services range from its search engine and advertising services to cloud computing, consumer electronics, and various other technology initiatives.
How the Company Makes MoneyAlphabet Inc. primarily generates revenue through its subsidiary Google, with the majority coming from advertising services. Google's advertising revenue is driven by ads displayed on its search engine, as well as on partner websites through the Google AdSense program. Additionally, Alphabet earns substantial income from its YouTube platform, which monetizes through advertisements and subscription services like YouTube Premium. The company also generates revenue from its Google Cloud services, which offer cloud computing solutions to businesses. Other Alphabet ventures, such as its 'Other Bets' segment, contribute to revenue through varied business models, including investments in life sciences and technology innovations, though these are less significant compared to Google's advertising and cloud services. Key partnerships and collaborations, such as those with smartphone manufacturers for Android OS, also play a role in its revenue generation.

Alphabet Class A Key Performance Indicators (KPIs)

Any
Any
Cloud Operating Margin
Cloud Operating Margin
Measures profitability of the cloud segment, highlighting efficiency and competitiveness in a key growth area for the company.
Chart InsightsAlphabet's Cloud Operating Margin has turned positive since early 2023, showing substantial improvement and reaching 17.8% by early 2025. This turnaround aligns with a 30% year-over-year increase in Google Cloud revenue, driven by AI advancements and infrastructure expansion. However, the company faces challenges with cloud capacity constraints, which could impact future growth. Despite these constraints, Alphabet's strategic investments in AI and technical infrastructure signal a commitment to sustaining this upward momentum in cloud profitability.
Data provided by:Main Street Data

Alphabet Class A Earnings Call Summary

Earnings Call Date:Jul 23, 2025
(Q1-2025)
|
% Change Since: 20.27%|
Next Earnings Date:Oct 28, 2025
Earnings Call Sentiment Positive
The earnings call presented a predominantly positive outlook with strong revenue growth across major segments, significant advancements in AI technology, and milestones for YouTube and Waymo. However, challenges such as a decline in network advertising revenue, increased depreciation expenses, and potential headwinds in ad revenues due to macroeconomic factors were acknowledged.
Q1-2025 Updates
Positive Updates
Strong Revenue Growth
Alphabet Inc. reported consolidated revenues of $90.2 billion for Q1 2025, an increase of 12% year-over-year, with Search, YouTube advertising, subscription platforms, and Google Cloud all experiencing double-digit growth.
AI Innovations and Adoption
AI advancements such as AI Overviews have been well received, with over 1.5 billion users monthly. The Gemini 2.5 Pro AI model has been launched, achieving high performance and recognition within the industry.
YouTube and Waymo Milestones
YouTube celebrated its twentieth anniversary with over 1 billion monthly active podcast users and 125 million subscribers to YouTube Music and Premium. Waymo is now serving over a quarter of a million paid passenger trips weekly, a fivefold increase from the previous year.
Google Cloud Growth
Google Cloud revenues increased by 28% to $12.3 billion, driven by growth in GCP core and AI products.
Operating Income and Margin Expansion
Operating income increased by 20% to $31 billion, and the operating margin increased to 33.9%, reflecting strong revenue growth and a favorable mix shift.
Negative Updates
Network Revenue Decline
Network advertising revenue decreased by 2% to $7.3 billion, reflecting a year-over-year decline.
Increased Depreciation Expenses
Depreciation expenses increased significantly, putting pressure on the income statement, with expectations for further acceleration throughout 2025.
Headwinds in Advertising Revenue
Uncertainties in the macro environment and changes to de minimis exemption are expected to create slight headwinds in advertising revenue, particularly affecting APAC-based retailers.
Company Guidance
During the first quarter of 2025, Alphabet Inc. reported strong financial performance with notable metrics highlighted during their earnings call. Consolidated revenues reached $90.2 billion, marking a 12% increase year-over-year, with Google services revenues growing by 10% to $77.3 billion and Google Cloud revenue increasing by 28% to $12.3 billion. The company's operating income rose by 20% to $31 billion, resulting in an operating margin of 33.9%. Subscriptions surpassed 270 million, driven by YouTube and Google One, while AI Overviews reached over 1.5 billion monthly users. The company also celebrated YouTube's 20th anniversary, with YouTube Music and Premium reaching over 125 million subscribers. Additionally, Waymo reported over a quarter of a million paid passenger trips weekly, a fivefold increase from the previous year. Despite facing headwinds from increased depreciation expenses, Alphabet continues to focus on productivity and efficiency to support its investment in AI and other growth areas.

Alphabet Class A Financial Statement Overview

Summary
Alphabet demonstrates exceptional financial performance with robust revenue growth, high profitability margins, a strong balance sheet with minimal leverage, and solid cash flow management. The company's high ROE and low debt further underline its financial health, positioning it as a stable and growing entity in the industry.
Income Statement
92
Very Positive
Alphabet's income statement shows impressive financial health with a strong gross profit margin of 58.6% and a net profit margin of 30.9% for TTM. The company’s revenue growth rate is robust at 16.9% over the past year, indicating strong market demand and operational efficiency. The EBIT margin of 32.7% and EBITDA margin of 37.3% further highlight Alphabet's profitability. This combination of growth and high margins reflects a well-managed, profitable enterprise with a strong competitive position in the industry.
Balance Sheet
88
Very Positive
Alphabet maintains a solid balance sheet with a low debt-to-equity ratio of 0.07, indicating minimal financial leverage and a strong equity position. The equity ratio of 72.6% reflects a robust capital structure primarily funded by equity. Return on Equity (ROE) is high at 32.1%, showing efficient use of shareholder funds to generate profits. Overall, Alphabet's balance sheet is strong, with ample liquidity and low financial risk.
Cash Flow
90
Very Positive
The cash flow statement reveals strong cash management practices with a free cash flow growth rate of 2.9%, indicating Alphabet's ability to generate and grow cash flows. The operating cash flow to net income ratio of 1.2 shows that the company converts a significant portion of its income to cash, enhancing its financial flexibility. Additionally, the free cash flow to net income ratio of 0.67 suggests solid cash flow generation relative to profits, supporting future growth initiatives and shareholder returns.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue350.02B307.39B282.84B257.64B182.53B
Gross Profit203.71B174.06B156.63B146.70B97.80B
EBITDA135.39B97.97B85.16B103.52B61.91B
Net Income100.12B73.80B59.97B76.03B40.27B
Balance Sheet
Total Assets450.26B402.39B365.26B359.27B319.62B
Cash, Cash Equivalents and Short-Term Investments95.66B110.92B113.76B139.65B136.69B
Total Debt25.46B27.12B29.68B28.39B26.77B
Total Liabilities125.17B119.01B109.12B107.63B97.07B
Stockholders Equity325.08B283.38B256.14B251.63B222.54B
Cash Flow
Free Cash Flow72.76B69.50B60.01B67.01B42.84B
Operating Cash Flow125.30B101.75B91.50B91.65B65.12B
Investing Cash Flow-45.54B-27.06B-20.30B-35.52B-32.77B
Financing Cash Flow-79.73B-72.09B-69.76B-61.36B-24.41B

Alphabet Class A Technical Analysis

Technical Analysis Sentiment
Positive
Last Price191.34
Price Trends
50DMA
173.14
Positive
100DMA
166.61
Positive
200DMA
173.55
Positive
Market Momentum
MACD
4.37
Negative
RSI
73.40
Negative
STOCH
95.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GOOGL, the sentiment is Positive. The current price of 191.34 is above the 20-day moving average (MA) of 179.10, above the 50-day MA of 173.14, and above the 200-day MA of 173.55, indicating a bullish trend. The MACD of 4.37 indicates Negative momentum. The RSI at 73.40 is Negative, neither overbought nor oversold. The STOCH value of 95.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GOOGL.

Alphabet Class A Risk Analysis

Alphabet Class A disclosed 28 risk factors in its most recent earnings report. Alphabet Class A reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Alphabet Class A Peers Comparison

Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
89
Outperform
$2.25T20.7434.79%0.42%13.02%37.73%
85
Outperform
$2.25T20.6434.79%0.53%13.02%37.73%
82
Outperform
$1.77T27.4739.83%0.29%19.37%47.56%
80
Outperform
$25.79B13.8448.41%17.81%1175.52%
76
Outperform
$139.64B114.2224.28%16.07%
76
Outperform
$30.73B8.809.85%-1.33%32.92%
59
Neutral
C$3.43B8.13-17.94%5.28%-2.63%-19.63%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GOOGL
Alphabet Class A
191.34
10.43
5.77%
BIDU
Baidu
92.45
2.08
2.30%
META
Meta Platforms
704.81
217.79
44.72%
SPOT
Spotify
675.74
344.95
104.28%
PINS
Pinterest
38.11
-2.71
-6.64%
GOOG
Alphabet Class C
192.11
9.39
5.14%

Alphabet Class A Corporate Events

Legal Proceedings
Alphabet’s Settlement in Stockholder Derivative Action Approved
Neutral
Jul 18, 2025

On July 8, 2025, the United States District Court for the Northern District of California preliminarily approved a settlement in a stockholder derivative action involving Alphabet Inc. The litigation alleged breaches of fiduciary duties by certain officers and directors, accusing them of exposing the company to antitrust investigations and enforcement actions. The settlement, which benefits Alphabet rather than individual stockholders, resolves claims related to anticompetitive business practices in the company’s search, Ad Tech, and Android operations. The defendants have denied all allegations, and the court will hold a settlement hearing on September 30, 2025, to consider the approval of the settlement terms.

The most recent analyst rating on (GOOGL) stock is a Buy with a $210.00 price target. To see the full list of analyst forecasts on Alphabet Class A stock, see the GOOGL Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Alphabet Stockholders Re-elect Directors at Annual Meeting
Neutral
Jun 12, 2025

At Alphabet Inc.’s Annual Meeting of Stockholders on June 6, 2025, stockholders voted on fifteen proposals, including the election of directors and various stockholder proposals. The election of directors saw the re-election of key figures such as Larry Page and Sundar Pichai. However, several stockholder proposals, including those related to shareholder rights, financial performance policies, and AI-related reports, were not approved. The ratification of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, was approved.

The most recent analyst rating on (GOOGL) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Alphabet Class A stock, see the GOOGL Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Alphabet Inc. Completes €6.75 Billion Bond Offering
Positive
May 6, 2025

On May 6, 2025, Alphabet Inc. successfully completed its euro-denominated bond offering, raising a total of €6.75 billion through the issuance of notes with varying maturities and interest rates. This strategic financial move is expected to enhance Alphabet’s capital structure and provide additional resources for its ongoing operations and growth initiatives.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 23, 2025