TLDR
- Alphabet hit an all-time high after Q1 revenue jumped 22% to $109.9 billion
- EPS came in at $5.11, crushing the $2.64 analyst consensus
- Google Cloud revenue surged 63% to $20 billion, with backlog nearly doubling to $460 billion
- Bank of America raised its price target to $430; consensus target sits at $397.48
- Alphabet raised its 2026 capex forecast to $180–$190 billion to fund AI infrastructure
Alphabet stock hit an all-time high of $385.84 on Thursday after the company posted first-quarter results that blew past Wall Street expectations.
Revenue for the quarter came in at $109.9 billion, up 22% year over year. EPS hit $5.11, more than double the analyst consensus of $2.64.
The stock had been trading around $384.28 during Thursday’s session, with a market cap of approximately $4.65 trillion.
Google Search revenue rose 19% to $60.4 billion. That’s a direct answer to concerns that AI chatbots from rivals like OpenAI and Anthropic could eat into search traffic.
CEO Sundar Pichai pushed back on those fears during the earnings call. “People love our AI experiences like AI Mode and AI overviews, and they’re coming back to search more,” he said.
Google Cloud Leads the Way
Google Cloud was the standout performer this quarter. Revenue jumped 63% to $20 billion, and the division’s order backlog nearly doubled to over $460 billion.
“Cloud accelerated again this quarter due to strong demand for our AI products and infrastructure,” Pichai said.
Operating income for the company rose 30% to $39.7 billion. Net income soared 81% to $62.6 billion, boosted partly by investment gains.
Wall Street Raises the Bar
The results triggered a wave of price target upgrades across Wall Street.
Bank of America raised its target from $370 to $430, maintaining a buy rating. That implies roughly 11.9% upside from current levels.
Susquehanna lifted its target to $460. KeyCorp set a target of $425 with an overweight rating. Rothschild & Co Redburn raised its target to $430.
The consensus analyst rating currently stands at “Moderate Buy,” with a consensus price target of $397.48.
Of the analysts covering GOOGL, 47 have a buy rating, two have a strong buy, and four have a hold. Wall Street Zen is one of the few that recently downgraded, cutting to hold in mid-April.
With results this strong, management also increased its spending plans. Full-year capital expenditure guidance was raised to $180–$190 billion, up from the prior range of $175–$185 billion.
CFO Anat Ashkenazi explained the move: “We are seeing unprecedented internal and external demand for AI compute resources.”
That level of spending is drawing attention. While investors rewarded the growth this quarter, elevated capex can put pressure on free cash flow if revenue growth slows.
On the regulatory side, Italy has asked the EU to probe Google’s AI search tools, and Switzerland has opened a separate investigation into keyword-bidding practices. Those probes add a layer of legal uncertainty heading into the rest of the year.
Institutional interest remains strong. Hedge funds and institutional investors own 40.03% of the stock. Several funds increased their positions in recent quarters, including CIBC Bancorp USA, which took a new stake valued at around $416 million.
Alphabet’s 52-week range now runs from $147.84 to $385.84, reflecting how far the stock has climbed over the past year.
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