Google’s 2025 felt like driving an F1 automobile in metropolis site visitors, because the tech behemoth powered by means of with occasional arduous brakes.
It kicked off the yr with Gemini all over the place, layered by means of Search, YouTube, and Workspace, which quietly turned Google’s apps into AI-native instruments. YouTube saved flexing its flywheel (shorts and linked TV), whereas Google Cloud tightened execution with main wins and steadier profitability.
Consequently, Alphabet inventory gained 35% year-to-date, beating broader-market positive factors by a cushty margin, and over 67% up to now six months alone.
Nevertheless, it wasn’t all clean crusing.
AI Overviews drew a ton of scrutiny, with rivals poking into its sturdy search moat, and regulators saved Google on velocity dial. Waymo confronted loads of safety-related questions, whereas the authorized meter saved buzzing.
That mentioned, a contemporary learn from Financial institution of America lands now with further weight forward of Google’s Q3 earnings print.
One top-ranked BofA analyst simply reset his value goal on Alphabet inventory forward of earnings, with the substance sitting within the particulars.
The timing of the observe factors to one thing value a a lot nearer look.
Financial institution of America’s newest analysis observe strikes a assured tone forward of Google’s Q3 outcomes.
Picture supply: Justin Sullivan/Getty Pictures
BofA lifts Google value goal to $280, sees 11% upside forward of Q3 outcomes
Forward of Google-parent Alphabet’s October 29 earnings report, Financial institution of America’s Justin Submit simply bumped his value goal on the inventory to $280 from $252, whereas sustaining a purchase score. His up to date new score implies practically an 11% upside from present ranges.
It’s essential to notice that the decision comes from an analyst who ranks thirty second out of greater than 10,000tracked by TipRanks. Moreover, he boasts a 70% success fee, together with a mean return of 24% per score.
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Submit’s reasoning is simple.
Google’s advert engine continues to be transferring alongside remarkably nicely. He sees stronger spending traits throughout a number of core classes in Q3, which must be sufficient to offset a gentle dip in natural search visits.
Additionally, his income forecast now sits at $86 billion, nudging it above Wall Road’s $85 billion consensus.
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Furthermore, he’s modeling earnings per share of $2.17, barely beneath consensus because of roughly $3.9 billion in authorized fees, however acknowledging that the underlying profitability stays intact.
Strip these numbers out, and Google’s working margin holds close to 35.7%, underscoring tight value management and steadier monetization.
Submit isn’t ignoring the larger themes, both. He expects Google to concentrate on broader Gemini AI adoption throughout merchandise and construct on its power within the Cloud, the place new buyer wins proceed to gasoline backlog and bottom-line growth.
Fast takeaways:
- Worth goal raised: BofA’s Justin Submit simply bumped Google inventory’s value goal to $280, highlighting 11% upside forward of Q3 earnings.
- Core adverts regular: Strong advert spend and price management successfully hold margins close to 36%, even with authorized prices.
- AI and Cloud raise: Gemini adoption and Google Cloud wins reinforce Alphabet’s trajectory.
Google’s Q3 earnings on deck
Alphabet is heading into Q3 with a good head of steam.
Its Q2 outcomes got here out clear, with its EPS touchdown at $2.31 (GAAP and normalized), beating estimates by $0.12 and $0.11, respectively, whereas its income hit $96.43 billion, a hefty $2.39 billion beat.
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For Q3, Wall Road’s modeling $2.29 EPS on $99.97 billion in income. Estimate revisions have leaned principally constructive over 90 days (29 up versus 12 down), which is a quiet vote of confidence in adverts, Cloud, and AI.
Buyers will zero in on Search and YouTube Shorts engagement, particularly if paid clicks and CPCs maintain; an enormous win for the “AI isn’t killing search” camp.
Cloud margin stability can be an crucial, with traders in search of opex self-discipline and wholesome backlog indicators. Gemini traction can be essential, particularly in Search, Workspace, and dev instruments.
That mentioned, listed below are Alphabet’s current earnings at a look over the previous 5 quarters:
- FQ2 2025 (June): EPS $2.31 (+$0.11 beat); income $96.43 billion (+$2.39 billion beat). YOY+13.8%.
- FQ1 2025 (Mar.): EPS $2.81 (+$0.80 beat); income $90.23 billion (+$1.08 billion beat). YOY+12.0%.
- FQ4 2024 (Dec.): EPS $2.15 (+$0.02 beat); income $96.47 billion (-$0.20 billion miss). YOY+11.8%.
- FQ3 2024 (Sept.): EPS $2.12 (+$0.27 beat); income $88.27 billion (+$2.05 billion beat). YOY+15.1%.
- FQ2 2024 (June): EPS $1.89 (+$0.05 beat); income $84.74 billion (+$0.45 billion beat). YOY+13.6%.
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