AI Powers Alphabet’s First $100B Quarter. Is GOOGL Stock a Buy?

Core Insights - Alphabet achieved its first-ever $100 billion revenue quarter, driven by the integration of artificial intelligence (AI) across its business segments [1] - The company's stock surged over 7% in pre-market trading following the strong financial results [1] Financial Performance - Alphabet's total revenue rose 15% year-over-year to $56.6 billion in Q3, with AI-driven experiences enhancing user engagement and monetization [3] - Cloud revenue increased by 34% to $15.2 billion in Q3, supported by the rising adoption of enterprise AI tools [5] Business Segments - The search business is benefiting from increased consumer reliance on AI-powered experiences, contributing to overall revenue growth [2] - YouTube's ad revenue is also experiencing growth, further bolstering Alphabet's financial performance [2] - The cloud division's backlog grew 46% quarter-over-quarter to $155 billion, indicating strong future growth potential [2] AI Integration - New AI features like AI Overviews and AI Mode are enhancing search result quality and commercial intent, leading to deeper user interactions and new monetization pathways [4] - The demand for AI-led services is driving strong performance in the cloud segment, with a notable increase in new Google Cloud Platform (GCP) customers, up nearly 34% year-over-year [5] Subscription Growth - Alphabet's subscription business surpassed 300 million paid users, fueled by the popularity of Google One and YouTube Premium [3]