Alphabet’s profits are about to be announced.What analysts are looking for | Wilnesh News
Google parent company Alphabet will report earnings after the market close on Thursday, adding to this week’s earnings reports from major technology companies. The tech giant’s shares were up 13.9% this year as of Wednesday’s close and soared 50% in the past 12 months, as investors welcomed the growth of the company’s cloud business and artificial intelligence investments and tools. Alphabet’s recent layoffs also reassured investors. Analysts polled by London Stock Exchange Group (LSEG) expected first-quarter earnings of $1.51 per share on revenue of $78.59 billion. Earnings per share are expected to increase by approximately 29% annually, with revenue growing by approximately 12.6%. What Wall Street expects to see: Artificial intelligence, cloud growth, advertising trends Beyond the headlines, analysts are also keeping a close eye on Alphabet’s revenue from its Google Cloud business, YouTube ads and its traffic acquisition costs. Updates on the company’s artificial intelligence products and advertising trends will also be top of mind, especially as the digital advertising market improves significantly. Meta Platform’s earnings report on Wednesday shook up the market, and the company said it will invest heavily to achieve its artificial intelligence goals. Analysts are generally bullish on Alphabet stock. About 80% of analysts have a buy or overweight rating on the stock, and the consensus price target suggests a 5.5% upside from Wednesday’s closing price, according to FactSet. Jefferies analyst Brent Thill remains bullish on Alphabet, saying he expects strong first-quarter results, with strong advertising, resilient consumer spending and likely consistent cloud demand. He has a buy rating on the stock with a $180 price target, saying the stock remains reasonably valued even after a slow start this year. Thiel said in an April 19 report: “We will continue to hold GOOGL stock in 2 months, as we see it continuing to move higher on improving momentum in the core advertising business, and as eventually ( ’25?), increasing visibility on the AI tailwind,” adding that “Google Cloud Computing could be the stock’s next breakout point.” Canaccord Genuity Capital Markets analyst Maria Ripps maintained her $190 price target and buy rating on the stock. “We expect Google to report solid results in the first quarter, with ad revenue growing at a double-digit rate year-over-year due to simpler competition, an improving macro backdrop for ad spending, and the growing appeal of artificial intelligence solutions.” Analysis the division wrote in a report on Sunday. She added: “We expect the cloud business to maintain healthy growth of about 20% in the first quarter.” Recovering from the decline after last quarter’s earnings report, the fourth quarter was Alphabet’s fastest revenue growth quarter since the beginning of 2022, and the company Reported revenue was $86.31 billion, up 13% from the same period last year and exceeding analysts’ expectations of $85.33 billion. Earnings per share for the period were $1.64, compared with analysts’ expectations of $1.59 per share. However, the company’s advertising revenue was $65.52 billion, missing analysts’ expectations of $65.94 billion, according to StreetAccount. This caused the stock price to fall 7.5% on January 31, the trading day after the article was published. GOOGL YTD Series Alphabet’s (GOOGL) 2024 Performance Alphabet’s YouTube generated $9.2 billion in fourth-quarter advertising revenue, slightly below Wall Street expectations. While YouTube has been a growth driver for the tech giant, TikTok poses a threat to its dominance of short-form videos. Alphabet is facing a world of changing user behavior, growing competition and greater regulatory challenges, Google search chief Prabhakar Raghavan told thousands of employees earlier this week question. “Things are not what they were 15 to 20 years ago,” he said. When it comes to artificial intelligence, Alphabet works on both sides of technology: innovators and investors. The company launched its rebranded generative artificial intelligence chatbot and voice assistant Gemini in February. It also embeds new generative artificial intelligence capabilities into its products, including maps. In terms of investment, Google last year committed to investing US$2 billion in OpenAI competitor Anthropic, after Google confirmed that it had acquired a 10% stake in the artificial intelligence system developer.
