Alphabet (Buy, $330 target) Search, Cloud, Capex all well above expectations as AI ambitions expand
In this first take following tonight’s results, we focus on:1. The true scope of GOOGL’s ambition begins to be revealed
2. Search growth beats expectations, underlining AI’s potential
3. Capex guidance for 2026 significantly outpaces expectations
4. Cloud revenue growth accelerates significantly, margins also well ahead
5. Companywide margins would have beaten ex-Waymo transaction SBC charge
Alphabet is a holding company. Through its subsidiaries, the company is engaged in a collection of businesses, which its primary business is Google. The company reports all non-Google businesses collectively as Other Bets. Google's main products and platforms are Android, Chrome, Gmail, Google Drive, Google Maps, Google Play, Search, and YouTube. The company also provides advertisers with tools that help them attribute and measure their advertising campaigns. In addition, Other Bets includes Access, Calico, CapitalG, GV, Verily, Waymo, and X, among others. Other Bets primarily engages in the sales of internet and TV services through Access as well as licensing and research and development services through Verily.
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