Salesforce CEO Marc Benioff Just Said Gemini 3 Changed the World. Does That Make GOOGL Stock a Buy?

Core Insights - Google has demonstrated resilience against competition from Microsoft-backed OpenAI, particularly with the launch of its advanced AI system, Gemini 3, on November 18, which has shifted the competitive landscape in its favor [1][4]. AI and Quantum Computing Commitment - Google's strategic early investment in AI and quantum computing has been pivotal, integrating AI into core services like Search, YouTube, and Maps long before it became mainstream [2]. Revenue Streams and Market Position - Google has a diverse revenue base, with significant contributions from its advertising business, cloud services, and other initiatives, positioning it as a dominant player in the digital landscape [3]. Stock Performance and Market Capitalization - Following the launch of Gemini 3, Google's stock reached an all-time high of $328.83 on November 25, with a market capitalization around $3.9 trillion, nearing the $4 trillion mark [5]. Recent Financial Performance - In Q3 fiscal 2025, Google reported total revenue of $102.3 billion, a 16% year-over-year increase, surpassing expectations [7]. Google Services revenue rose 14% to $87.1 billion, driven by strong performance in Search and YouTube ads [8]. Cloud Revenue Growth - Google Cloud revenue increased by 34% to $15.2 billion, indicating strong demand for its cloud offerings [8]. Profitability Metrics - Operating income for the quarter rose 9% to $31.2 billion, with an operating margin of 30.5%, impacted by a $3.5 billion antitrust fine [8]. Earnings Per Share - Google reported an EPS of $2.87, reflecting a 35.4% year-over-year increase, exceeding estimates by approximately 27% [9]. Future Investments - The company plans capital expenditures between $91 billion and $93 billion for fiscal 2025, highlighting ongoing investments in infrastructure and technology [9]. Gemini 3 User Engagement - Gemini 3 has achieved significant user engagement, with 2 billion monthly users accessing AI Overviews and over 650 million monthly users of the Gemini app [11]. Analyst Sentiment - Analysts have expressed strong enthusiasm for Gemini 3, with investment firms recognizing it as a leading AI model and a potential game-changer for Google's competitive position [13]. Analyst Ratings - Among 55 analysts covering Google stock, 44 rate it a "Strong Buy," indicating strong market confidence, with an average price target of $321.96 [14].