Google parent Alphabet (NASDAQ:GOOGL) is positioned for continued growth as advancements in artificial intelligence enhance its core Search business and prepare its Cloud platform for acceleration with new data center capacity.
Fueled by innovations in AI, Google’s parent company, Alphabet, is seeing renewed strength in its Search division and expects to capture a larger share of the cloud market as it brings more infrastructure online.
Citizens JMP Securities analyst Andrew Boone reiterated Alphabet with a Market Outperform and a $290 price forecast.
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Boone noted Alphabet’s stock has significant room for growth, even after its 70% surge in the last six months. The analyst attributes this potential to AI, which is expected to enhance Google’s Search business and accelerate the growth of Google Cloud Platform (GCP) as new data centers become operational. Consequently, he predicted Google would report strong third-quarter 2025 results that beat consensus estimates.
Boone argues that Google’s Search division remains healthy. The analyst noted AI Overviews are driving greater query growth while Google’s mature experience for commercial queries outpaces ChatGPT.
He also points to third-party data showing increased user visits and app sessions, suggesting AI is expanding the search market by better understanding user intent beyond simple keywords.
Boone expressed optimism about Google Cloud, which is expected to boost his 2026 revenue estimates, citing substantial data center capacity that is likely to come online by 2025.
He noted that Google’s custom silicon (TPUs) and vertical integration provide a superior cost advantage, enabling it to win a larger share of cloud budgets from top AI labs and startups.
Boone observed that the market’s perception of Google has shifted from an “AI loser” to an “AI winner” over the past six months.
The analyst predicted that the expected release of Google’s next-generation model, Gemini 3.0, by 2025 will pose as an additional tailwind.
He noted his current earnings estimates for Google appear conservative, especially when comparing its valuation to that of its peers, such as Meta Platforms Inc (NASDAQ:META).
Boone projected third-quarter revenue of $100.06 billion and EPS of $2.30.
Price Action: GOOGL stock is up 1.99% at $255.48 at last check on Wednesday.
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