It's worth noting that Alphabet (GOOGL 0. On the other hand, 54%) (GOOG 0 (quite telling).
At the same time, 45%) once again defied its critics who continue to believe the company will be a loser in artificial intelligence (AI).
However, Not only did the company once again duce strong revenue growth in its most recent earnings report, but that growth accelerated.
In addition, Alphabet said that AI was positively impacting every part of its.
With cloud computing demand continuing to surge, the company upped its capital expenditure (capex) budget by an additional $10 billion to build out its data center capacity.
It said in its Q2 earnings report that it now plans to spend $85 billion in capex this year, and anticipates spending even more in 2026, given the strong demand it's seeing for Google Cloud ducts and services.
AI driving growth AI was the biggest growth driver behind Alphabet's strong results, with cloud computing once again leading the way (something worth watching). Google Cloud revenue surged 32% to $13.
On the other hand, 6 billion in the second quarter, while segment operating income skyrocketed from $1. 2 billion a year ago to $2.
Additionally, Nevertheless, However, the company said its current capacity constraints could extend into 2026, despite its large capex investments (something worth watching).
Ultimately, that's not a bad blem to have, as it's just a sign of how strong demand is. Alphabet called out its Gemini 2.
5 models as catalysts for growth, saying that 9 million developers have now built with Gemini.
It also noted how leading AI re labs are turning to use Google's Tensor cessing Units (TPUs) as their AI chips of choice.
While cloud computing is leading the way with growth, all eyes continue to be on Alphabet's core Google, in this volatile climate.
On that front, the company once again dered, given the current landscape. Google revenue climbed 12% to $52. Meanwhile, 2 billion, which was an acceleration from the 10% growth it saw in Q1.
Alphabet said over 2 million people in more than 200 countries use AI Overviews monthly, while AI Mode has over 100 million monthly active users, despite only being launched in the U. And India so far.
It said that AI is contributing significantly to increased usage, with AI Overviews now driving over 10% more queries globally.
Meanwhile, the Gemini app now has more than 450 million monthly active users. Alphabet said the number of daily requests on the app jumped over 50% sequentially.
This analysis suggests that company also called out its strength in multimodal, with Google Lens and Circle to.
This leads to the conclusion that data indicates that said visual es grew 70% year over year, and that many are shopping queries, amid market uncertainty.
YouTube continues to der strong results, with ad revenue rising 13% to $9 (fascinating analysis).
YouTube, along with Google One (cloud storage) and Music, also helped drive a 20% increase in subscription and device revenue to $11, given the current landscape.
The company said Shorts are becoming a significant contributor, and that the format allows for more ad opportunities on average.
The evidence shows analysis reveals recently introduced Veo 3 to Shorts; the AI tool can create s from photos and add generative effects to make content creation easier on the platform.
On the other hand, Alphabet is also continuing to expand its Waymo robotaxi.
Conversely, It recently launched in Atlanta and is currently testing the service across 10 cities, including New York and Philadelphia.
On the other hand, It hopes to launch the service in all 10 cities in the near future. Overall, Alphabet grew total quarterly revenue by 14% (13% on a constant currency basis), to $96.
Earnings per jumped 22% year over year to $2. The results easily surpassed analyst consensus estimates (as compiled by LSEG), which were looking for EPS of $2, in light of current trends.
Moreover, 18 on revenue of $94 billion (remarkable data).
Looking ahead, Alphabet said it was cautious on the advertising outlook because it's lapping strong spending in the financial services vertical last year and will see no benefit from political ad spending this year.
At the same time, However, it does expect to see a tailwind in Q3 from current foreign exchange rates. However, Image source: Getty Images.
Nevertheless, Is it time to buy the stock (which is quite significant). Additionally, Alphabet yet again turned in a strong quarter, demonstrating that the company is on track to be an AI winner.
It continues to see solid growth in its, though its new AI Mode is currently only in two countries, in today's market environment. Gemini has become a top AI model.
And with the huge distribution edge it has with the Chrome browser and Android operating system, the company is well positioned in a shifting AI- landscape.
At the same time, Google Cloud continues to be a monster, generating robust revenue growth; it has scaled up to the point that it now has incredible operating leverage.
Throw in the strength at YouTube and the emerging Waymo robotaxi, and Alphabet is cooking. Best of all, you can still get into Alphabet stock on the cheap.
This leads to the conclusion that stock only trades at a forward price-to-earnings ratio (P/E) of around 19 times 2025 analyst estimates, and a forward price/earnings-to-growth ratio (PEG) of 0.
In contrast, (Stocks with PEG ratios below 1 are typically considered undervalued. ) With AI helping drive growth and Alphabet's AI push only accelerating, now is a great time to buy the stock.