Alphabet(US:GOOGL) Huachuang Securities·2025-11-02 09:20Investment Rating - The industry investment rating is "Recommended," indicating an expected increase in the industry index by more than 5% over the next 3-6 months compared to the benchmark index [47]. Core Insights - The report highlights that Alphabet's FY2025Q3 revenue reached $102.3 billion, marking a 16% year-over-year growth, driven by double-digit expansion across all core business segments [3][8]. - The AI-driven strategy has shown significant results, with Google Cloud's revenue soaring by 34% to $15.2 billion, supported by strong demand for AI products and infrastructure [3][8]. - Capital expenditures (CapEx) for FY25Q3 were $23.9 billion, an 83% increase year-over-year, with expectations for CapEx in 2025 to be adjusted to $91-93 billion due to robust cloud customer demand [5][16]. Summary by Sections 1. Google FY2025Q3 Performance - Total revenue surpassed $100 billion for the first time, reaching $102.3 billion, with a net profit increase of 33% to $35 billion [3][8]. - Google Services revenue was $87 billion, primarily driven by search and other advertising businesses [3][8]. - Google Cloud revenue increased by 34% to $15.2 billion, with a significant rise in operating profit [3][8]. 2. AI Business and Strategy - The AI "full-stack" strategy has yielded results, with advancements in AI infrastructure and models, including the introduction of the seventh-generation TPU Ironwood [4][13]. - Over 2.3 billion videos have been generated using AI models, showcasing the widespread adoption of Google's AI technologies [4][13]. - The search business has seen a significant increase in query volume due to AI enhancements, with over 75 million daily active users engaging with AI features [4][14]. 3. Capital Expenditures - Capital expenditures for FY25Q3 were $23.9 billion, reflecting an 83% year-over-year increase [5][16]. - The CapEx guidance for 2025 has been raised to $91-93 billion, with expectations for a significant increase in 2026 [5][16].