Alphabet's valuation remains highly attractive, says Evercore ISI's Mark Mahaney

Financial Performance - Alphabet's earnings and revenue exceeded expectations, demonstrating strong results across search, cloud, and YouTube [1] - The company is trading at 18x earnings, a discount compared to Meta and the broader market, making its valuation attractive [3] - Alphabet is showing cost discipline by managing headcount and achieving record operating margins despite rising depreciation [5] Market Dynamics & Competition - Concerns about competition from Chat GPT and Claude impacting Google's market share have been addressed, with Google performing better than anticipated [2] - The ad market has held up better than expected, and the cloud market continues to strengthen due to generative AI demand [4] - Google's execution is strong, contributing to its positive performance [4] AI & Technology - Google possesses a significant data advantage for training generative AI solutions [8] - Google has been investing in AI for a decade, with Gemini's potential to enhance Google products [6][9] - The market is not concerned about Alphabet's capital expenditure (capex) spending on AI [10] - There is evidence of a return on investment (ROI) in generative AI, with improved ad targeting and user engagement [12][13]