Is GOOG Stock a Buy Amid the Software Selloff?

Core Viewpoint - The selloff in artificial intelligence (AI) stocks has intensified, affecting major players like Apple and the "Magnificent Seven" stocks, with Nvidia being the only exception benefiting from increased AI capital expenditures [1][2]. Group 1: Market Performance - All "Magnificent Seven" stocks, except Nvidia, have turned negative for the year, with Nvidia expected to benefit from the ongoing AI spending spree [2]. - Alphabet (GOOGL) has shown resilience, being the second-best performer among the "Magnificent Seven" in 2026, with only a 2.3% decline year-to-date despite a post-earnings selloff [3]. Group 2: Financial Performance - Alphabet reported a strong Q4 2025, with revenue increasing nearly 18% and net profits rising 30% year-over-year, marking the second-highest topline growth among the "Magnificent Seven" [5]. - Cloud revenue for Alphabet grew by 48%, with a backlog increase of 55% sequentially to $240 billion, although concerns exist regarding the durability of Microsoft's larger backlog tied to OpenAI [6]. - YouTube is now generating an annualized revenue run rate of $60 billion, with 325 million paid subscribers at the end of 2025 [7]. Group 3: Capital Expenditures - Alphabet raised its 2026 capital expenditure budget to between $175 billion and $185 billion, approximately double the amount spent in the previous year, which led to a decline in GOOGL stock despite strong earnings [8].