谷歌-C：3Q24 results beat; Google Cloud maintains strong momentum

Investment Rating - Maintain BUY rating with a target price of US$218.0 based on 24x FY25E PE [1][6] Core Viewpoints - Alphabet's 3Q24 results beat expectations with total revenue up 15% YoY to US$88.3bn and net income growing 34% YoY to US$26.3bn [1] - Google Cloud revenue surged 35% YoY to US$11.4bn, driven by GenAI adoption and improved efficiency [1] - AI integration in search and shopping ads is unlocking new monetization opportunities, with AI Overviews serving over 1bn users monthly [1] - Alphabet's operating margin expanded by 4.5ppts YoY to 32.3% in 3Q24, supported by effective cost management [1] Financial Performance - FY24E revenue is projected at US$349.7bn, with YoY growth of 13.8%, and FY26E revenue is expected to reach US$437.6bn [2][4] - Net profit for FY24E is forecasted at US$99.2bn, with a YoY increase of 34.4%, and FY26E net profit is estimated at US$126.1bn [4][10] - Gross margin is expected to improve from 58.0% in FY24E to 59.1% in FY26E, while operating margin is projected to rise from 31.4% to 33.1% over the same period [4][13] Google Cloud Performance - Google Cloud's operating profit margin (OPM) reached a record high of 17% in 3Q24, up 14ppts YoY and 6ppts QoQ [1] - Vertex AI, the enterprise AI platform, saw a 14x growth in Gemini API calls over a six-month period [1] AI and Search Integration - Google Search & other revenue grew 12% YoY to US$49.4bn in 3Q24, driven by AI-enhanced search experiences [1] - Circle to Search is now available on over 150mn Android devices, further enhancing user engagement [1] Capital Expenditure - Total capex in 3Q24 increased 62% YoY to US$13.1bn, primarily focused on servers and data centers [1] - Management expects capex to remain stable QoQ in 4Q24E and increase YoY in 2025E, albeit at a slower rate [1] Valuation - Alphabet is valued at US$218.0 per share based on 24x 2025E P/E, reflecting its leadership in the global advertising market and AI potential [6][7] - The target P/E multiple represents a premium to the sector average of 23x [6]