Alphabet's Q1 2025 Earnings Surge: AI Innovations Drive Growth Across Google Services and Cloud

What's Going On With Google Parent Alphabet Stock Friday? - Alphabet (NASDAQ:GOOGL)

Alphabet Inc. GOOGL shares are trading higher on Friday after the company reported better-than-expected first-quarter earnings on Thursday after the market closed. What To Know: Alphabet reported adjusted earnings per share of $2.81, beating analysts' estimate of $2.01. In addition, the company reported sales of $90.23 billion, beating analysts' estimate of $88.87 billion and representing a 12% year-over-year growth. Alphabet attributed the revenue growth to strong performance in Google Search and other, YouTube ads, Google subscriptions, devices and platforms and Google Cloud. The company broke down revenue further. It said Google Services revenue rose 10% to $77.3 billion, driven by higher activity in Search & Other, subscriptions, platforms and devices and YouTube ads. Additionally, Google Cloud revenue grew 28% to $12.3 billion, driven by growth in Google Cloud Platform products and AI infrastructure and solutions. Alphabet also increased its quarterly dividend by 5% to 21 cents per share. Sundar Pichai, CEO of Google, said, "We're pleased with our strong Q1 results, which reflect healthy growth and momentum across the business. Underpinning this growth is our unique full stack approach to AI. This quarter was super exciting as we rolled out Gemini 2.5, our most intelligent AI model, which is achieving breakthroughs in performance and is an extraordinary foundation for our future innovation. Search saw continued strong growth, boosted by the engagement we're seeing with features like AI Overviews, which now has 1.5 billion users per month. Driven by YouTube and Google One, we surpassed 270 million paid subscriptions. And Cloud grew rapidly with significant demand for our solutions." Analyst Changes: Following the earnings report, multiple analysts issued price target adjustments. Piper Sandler analyst Thomas Champion maintained an Overweight rating on Alphabet and raised the price target from $185 to $195. B of A Securities analyst Justin Post maintained a Buy rating on Alphabet and raised the price target from $185 to $200. Wells Fargo analyst Ken Gawrelski maintained an Equal-Weight rating on Alphabet and raised the price target from $167 to $175. Rosenblatt analyst Barton Crockett maintained a Neutral rating on Alphabet and lowered the price target from $205 to $189. Related Link: Bitcoin Fundamentally Decoupled From US Tech Stocks, BlackRock's Jay Jacobs Says GOOGL Price Action: At the time of writing, Alphabet shares are trading 2.75% higher at $163.71, according to data from Benzinga Pro. Image: via Shutterstock GOOGLAlphabet Inc$162.912.28%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum53.18Growth64.44Quality-Value51.39Price TrendShortMediumLongOverviewGot Questions? AskWhich companies will benefit from Google Cloud growth?How might YouTube ads impact advertising firms?Will AI advancements drive tech investments further?Who else is affected by Alphabet's earnings surge?How should investors view Alphabet's dividend increase?Could competitors struggle after Alphabet's success?What opportunities exist in AI infrastructure investments?How will strong subscription growth affect market valuations?Which analysts see potential in Alphabet's stock?What sectors could thrive due to Google's innovations?Powered ByMarket News and Data brought to you by Benzinga APIs

Why Alphabet Stock Is Rising Today | The Motley Fool

Alphabet (GOOGL 1.70%) (GOOG 1.52%) stock is closing out the week's trading with another round of solid gains. The company's share price was up 1.6% as of 3:20 p.m. ET Friday and had been up as much as 4.3% earlier in the session. Alphabet published its first-quarter results after the market closed yesterday and delivered sales and earnings for the period that came in ahead of the average Wall Street targets. The business posted non-GAAP (adjusted) earnings per share of $2.81 on sales of $90.23 billion, topping the average analyst estimate's call for per share earnings of $2.01 on revenue of $89.15 billion. Alphabet reported a substantial sales beat in the first quarter, with stronger-than-expected performance for the advertising business helping to offset a small shortfall in sales from the company's Google Cloud infrastructure services business. Artificial intelligence (AI) services helped push ads revenue up to $66.8 billion, topping Wall Street's call for sales of $66.4 billion. And despite sales of $12.26 billion for Google Cloud falling slightly short of Wall Street's forecast, the unit still grew 28% year over year in the period. Alphabet's beat on profitability was even more impressive. Along with strong first-quarter results, Alphabet's management delivered reassurances that the company's business can continue to be resilient in the face of macroeconomic challenges and regulatory pressures that might eventually result in some of its business units being spun off. The company's big first-quarter earnings beat delivered encouraging signs of operational efficiency. With sales performance for the period also coming in significantly better than anticipated, Alphabet is showing that its growth engine remains strong and is seeing tangible benefits from AI.

Is Alphabet Stock a Buy Now? | The Motley Fool

Alphabet (GOOG 1.14%) (GOOGL 1.48%) investors have had a difficult year so far, as shares of the technology giant have lost 15% of their value as of this writing, driven by the broader weakness in technology stocks on account of tariff-fueled economic uncertainties, but the company's latest results suggest that its fortunes may turn around. Shares of the technology giant popped after the release of its first-quarter 2025 results on April 24. Alphabet's top line exceeded expectations, while its earnings crushed Wall Street's estimate by a big margin. The company is benefiting from the growing deployment of AI-focused tools in its various offerings, which is why it saw robust growth in its advertising and cloud businesses. Should investors start buying Alphabet stock following its results in anticipation of more upside? Let's find out. Alphabet's revenue increased 14% year over year last quarter to $90.2 billion in constant-currency terms. Meanwhile, the company's earnings jumped 49% from the year-ago period to $2.81 per share. Alphabet CEO Sundar Pichai pointed out that AI is enabling "significant growth opportunities" for the company. The tech giant is offering powerful graphics processing units (GPUs) from Nvidia, along with its custom artificial intelligence (AI) processors to customers for AI model training and inference. As a result, Alphabet customers can build and deploy applications or integrate generative AI solutions into their businesses through its Google Cloud platform without the need to invest in expensive hardware. The company also offers a development platform with which its customers can build AI agents and deploy them in more than 100 enterprise applications. This should turn out to be another long-term tailwind for Alphabet, since the agentic AI market is expected to clock annual growth of 44% through the next decade. The rapid adoption of the above-mentioned AI-focused tools explains why Google Cloud revenue increased an impressive 28% year over year to $12.3 billion. That was much higher than the company's overall revenue growth, and the quarterly revenue run rate of the cloud business indicates that this segment could hit $50 billion in revenue this year. What's more, the Google Cloud business is growing at a faster pace than the overall cloud market. Market research firm Canalys expects global cloud market revenue to jump 19% in 2025, and Alphabet's Q1 cloud revenue growth suggests that it is gaining ground in this space. Given that the adoption of cloud-based AI services is projected to grow at an annual rate of 32% through 2029, it won't be surprising to see Alphabet's cloud revenue increasing at solid rates in the long run. Coming to the company's search and advertising business, users are rapidly adopting the AI Overviews on Google Search. That's not surprising, as this feature gives users a summary of the query or the topic they are looking for, along with relevant links. Alphabet points out that this feature is now being used by more than 1.5 billion users each month. Meanwhile, another AI-powered search tool known as Circle to Search, which is now available across more than 250 million devices, saw a 40% spike in usage last quarter. All this should allow Google to maintain its dominance in the search engine market as users increase the adoption of its AI search tools. That, in turn, should ideally help Google attract more advertisers. Analysts have raised their earnings growth expectations for Alphabet following its latest report. This is evident from the chart. What's worth noting is that analysts now expect slightly better earnings performance from the company over the next couple of years as well. However, don't be surprised to see Alphabet do better than that, as the growing adoption of its AI tools could encourage advertisers and users to spend more on its offerings. That's why investors should consider buying Alphabet right away, as it is trading at just 18 times earnings, a nice discount to the tech-laden Nasdaq-100 index's price-to-earnings ratio of 28. Alphabet's potential to deliver stronger earnings growth could eventually lead the market to reward it with a premium valuation, and that could send this tech stock higher in the future.