Shares of Google parent Alphabet Inc (NASDAQ:GOOGL) are up 4.2% to trade at $286.05 at last glance, after the company reported record revenue of $100 billion for the third quarter, surpassing analysts' expectations. Quarterly profits of $2.87 per share also impressed due to strong Google cloud and YouTube advertising revenue, as well as a $155 billion customer backlog. This year, the 'Magnificent 7' member says its AI spending is set to reach $93 billion. GOOGL surged to a record high of $291.59 right out o ...

Core Insights - Alphabet, Inc. reported Q2 results that exceeded Wall Street expectations for the tenth consecutive quarter, with revenue of $96.43 billion and earnings per share of $2.31, surpassing estimates of $93.72 billion and $2.16 respectively [1][6] Revenue Performance - Total revenue increased by 14% year-over-year, driven by strong performance across various segments [6] - Google Advertising revenue reached $71.34 billion, up from $64.62 billion year-over-year [6] - Google Search revenue was $54.19 billion, an increase from $48.51 billion year-over-year [6] - YouTube Advertising generated $9.8 billion, up from $8.66 billion year-over-year [6] - Google Cloud revenue grew to $13.62 billion, compared to $10.35 billion year-over-year, reflecting a 32% year-over-year growth [2][6] AI and Market Trends - AI Overviews are driving 10% more queries, with management reporting growth in both queries and commercial queries, contrary to expectations that AI would slow down query growth [3] - Monthly average users for AI Overviews reached 2 billion, with Gemini at 450 million and AI Mode at 100 million, while paid clicks grew by 4% in Q2 [4] - Advertisers utilizing AI tools experienced a 14% increase in conversions, indicating strong adoption rates across Alphabet's products [4] Analyst Reactions and Price Target Adjustments - Analysts from various firms raised their price targets for Alphabet shares, reflecting confidence in the company's performance and growth potential [6] - KeyBanc Capital Markets raised the price target from $215 to $230, while JPMorgan increased it from $200 to $232 [6] - Other notable adjustments include BMO Capital's increase from $208 to $225 and RBC's from $200 to $220 [6] Concerns and Market Position - Despite strong performance, concerns were raised regarding Google's dominance in traditional search and its lag in chatbot technology, which could pose risks if the market shifts towards AI chatbots [5]