<p>-
- Google is getting a boost from AI after spending billions</p>
<p>Daniel HowleyJuly 25, 2025 at 4:15 AM</p>
<p>Google parent Alphabet (GOOG, GOOGL) is finally starting to cash in on the billions of dollars it's spending on its rapid AI buildout. The company reported better-than-anticipated earnings after the bell on Wednesday, with CEO Sundar Pichai pointing to AI as a key growth catalyst for its various products.</p>
<p>Google cloud revenue climbed 32% and backlog, or purchase commitments from customers not yet realized, rose 38%. Search also performed better than expected during the quarter, with sales increasing 12% year over year.</p>
<p>Wall Street previously raised concerns that chatbots and search offerings from AI upstarts like OpenAI (OPAI.PVT), Perplexity (PEAI.PVT), and Anthropic (ANTH.PVT) would steal users from Google's own Search product. But according to Pichai, Search revenue grew by double digits, and its AI Overviews feature, the small box at the top of the traditional search page that summarizes information, now has 2 billion monthly users.</p>
<p>But Google also announced it's pouring even more money into its AI development, saying in its earnings release that it will spend an additional $10 billion on the technology this year, bringing its total capital expenditures from $75 billion to $85 billion.</p>
<p>Despite that, analysts are riding high on Google's stock.</p>
<p>In a note to investors on Wednesday, Jefferies analyst Brent Thill said Google's results back up its increased spending.</p>
<p>"After hiccups in early '23, [Google's] AI efforts picked up urgency and have now delivered benchmark-leading Gemini 2.5 Pro models," Thill wrote.</p>
<p>"This is starting to show up in [key performance indicators], with Cloud [revenue accelerating] to 32% [year over year] from 28%, tokens processed 2x to 980 [trillion] tokens since April, and search ad [revenue accelerating] to 12% from 10%. This confidence supports '25 [capital expenditures] raise to $85B."</p>
<p>Morgan Stanley's Brian Nowak offered a similar outlook for Google, raising the firm's price target on the tech giant from $205 to $210. Wedbush's Scott Devitt also raised his price target on the company to $225.</p>
<p>Malik Ahmed Khan at Morningstar pointed out that while AI Overview searches are monetizing at the same rate as standard Google searches, "AI Overviews are helping increase search volumes within Google Search, with the feature driving over 10% more queries, leading to additional sales within the Search segment."</p>
<p>Alphabet CEO Sundar Pichai speaks at a Google I/O event in Mountain View, Calif., Tuesday, May 20, 2025. (AP Photo/Jeff Chiu) ()</p>
<p>But behind all of that are the potentially devastating consequences from a judge's decision that held it liable for antitrust violations in search. Judge Amit Mehta of the US District Court for the District of Columbia is expected to issue a ruling on "remedies" that follows the Justice Department's victory against the company sometime next month.</p>
<p>Judge Mehta held that Google violated antitrust law by boxing out rivals in the online search engine and online search text markets. To restore competition, he could order Google to refrain from longstanding exclusivity deals like the one with Apple (AAPL) that set Google Search as the default option on the iPhone.</p>
<p>Mehta could also force Google to sell off its Chrome browser, the most popular web browser in the world. That would put a dent in Google's all-important search business, a dangerous proposition for the company.</p>
<p>Join Groq CEO Jonathan Ross, along with other newsmakers and top investors, at Yahoo Finance Invest on November 12–13 in NYC as they discuss the agenda for success in 2026. Register to attend today.</p>
<p>Sign up for Yahoo Finance's Week in Tech newsletter. (yahoofinance)</p>
<p>Email Daniel Howley at [email protected]. Follow him on X/Twitter at @DanielHowley.</p>
<p>Click here for the latest technology news that will impact the stock market</p>
<p>Read the latest financial and business news from Yahoo Finance</p>
<a href="https://ift.tt/GKrQmjC" class="dirlink-1">Original Article on Source</a>
Source: "AOL Money"
Source: AsherMag
Full Article on Source: Astro Blog
#LALifestyle #USCelebrities