Alphabet Q3 earnings beat Wall Street expectations

Core Insights - Alphabet reported strong Q3 earnings with revenue of $102.35 billion, exceeding estimates of just under $100 billion [1] - YouTube ad revenue and overall Google ad revenue also surpassed expectations, with Google ad revenue at $74.18 billion against an expected $72.46 billion [2] - The stock rose approximately 6% in after-hours trading, reflecting positive market reaction to the earnings report [3][7] Financial Performance - Operating income missed expectations, but earnings per share (EPS) of $2.87 beat the forecast of $2.26 [2] - Google Cloud Platform (GCP) revenue was reported at $15.16 billion, exceeding the street estimate of $14.75 billion, indicating strong growth in the cloud segment [6] - Search revenue was robust at $56.57 billion, beating the estimate of just under $55 billion, showcasing resilience in the search business [6] Market Position and Competitive Landscape - Analysts remain bullish on Alphabet, with price targets reaching as high as $300 per share, reflecting confidence in the company's growth prospects [4] - The competitive pressures from AI, particularly from OpenAI, are acknowledged, but Google’s investments in AI and cloud infrastructure are seen as positive factors [4][10] - GCP is perceived as a strong performer, with growth in the mid-30% range, contributing to a higher valuation multiple for the company [8][9] Future Outlook - The regulatory environment appears to be stabilizing, reducing concerns for Alphabet moving forward [10] - While OpenAI poses a long-term risk to Google's core search business, current trends indicate that Google continues to grow its search activity effectively [11][12] - The digital advertising market is expected to maintain momentum, with larger platforms like Google and Meta anticipated to perform well [16]