I Can't Stay Quiet on Google Stock (GOOG) Any Longer

Quick Overview

Google stock (GOOG) is presented as a strong long-term investment due to its massive AI investments, leading to significant growth in Cloud revenue ($155 billion backlog, up 46% Q/Q) and the success of Gemini (7 billion tokens/min processing, 650 million monthly active users), despite facing competition from Nvidia and slower growth in search advertising compared to the broader digital ad market.

Key Points: Google Cloud's AI revenue is a key driver, with the Cloud backlog growing 46% quarter-over-quarter to $155 billion. Gemini processes 7 billion tokens per minute via direct API use and the Gemini app has over 650 million monthly active users, with queries tripling since Q2. Alphabet's Q3'25 Capital Expenditures reached $23.953 billion (up 83% Y/Y), driven by heavy investment in AI infrastructure like custom TPUs (Ironwood) over relying solely on Nvidia GPUs. Google Cloud holds 13% market share in cloud infrastructure services as of Q3 2025, behind AWS (29%) and Azure (20%), but is showing strong growth. Google's Search revenue growth is slowing (14% Y/Y growth for Q3'25) compared to its historical growth rate, raising concerns about generative AI disruption. Alphabet's P/E ratio (29.8x) is slightly below the peer average (32.1x) despite having lower projected earnings growth (10.14%) than peers like Amazon (15.83%). The speaker plans to dollar-cost average into GOOG stock in 2026, believing it is undervalued compared to peers like Nvidia and Broadcom, which dropped rank on the speaker's watchlist.

Context: The video analyzes the investment potential of Alphabet (Google) stock, focusing heavily on its strategic pivot towards Artificial Intelligence, particularly with its Gemini models and custom TPU hardware (Ironwood). The speaker uses financial data from Alphabet's recent earnings calls, market share charts for cloud and AI advertising, and peer comparison metrics (like P/E ratio) to argue why GOOG is currently undervalued despite competitive pressures from Nvidia and slowing growth in its core search business.