There’s plenty for bulls and bears to hash out over Alphabet’s (GOOGL) first quarter earnings. Google stock has retreated about 14% in 2025 and technical ratings are mixed.
Institutional ownership of GOOGL stock has waned. However, Alphabet stock has clawed back to its 50-day moving average, a key technical level. Further, Google is among artificial intelligence stocks to watch.
Google delivered first quarter earnings and revenue that topped consensus estimates as internet search advertising growth beat expectations while cloud computing growth was virtually in-line and YouTube fell slightly short.
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From Search To Advertising, Will Google’s Big AI Bet Pay Off?
“We’re seeing green shoots in search with higher engagement and monetizable ads within AI Overviews,” said Truist Securities analyst Youssef Squali in a report. “While questions abound, Google remains at the forefront of the AI race which we believe is the company’s to lose.”
Alphabet’s investment in Elon Musk’s SpaceX boosted Q1 profit. Alphabet reported $8 billion in unrealized gains from its stake in privately held SpaceX, said reports. Alphabet invested in SpaceX in 2015.
Further, Google reiterated $75 billion in 2025 capital spending in 2025 as it increases artificial intelligence investments.
For investors, the internet search business remains top of mind amid new artificial intelligence driven competition from OpenAI’s ChatGPT and others. Further, Google began deploying AI Overviews in the U.S. in mid-2024, with conversational summaries topping links for many search queries.
On the Q1 earnings call with analysts, Google said AI Overviews now has over 1.5 billion monthly active users.
Will Wiz Acquisition Boost Google Cloud?
Google’s cloud computing unit’s revenue rose 28% in Q1. Cloud growth could accelerate as more AI infrastructure ramps up in the second half of 2025.
In March, Alphabet agreed to buy fast growing cybersecurity firm Wiz in an all-cash $32 billion deal. The big question for Google stock: will the Wiz purchase boost cloud computing market share versus Amazon.com (AMZN) and Microsoft (MSFT)?
One worry for Google stock is that economists say chances for a U.S. recession are increasing amid Trump tariffs. And, spending on digital advertising could be impacted.
Google Stock: Antitrust Worries
Meanwhile, antitrust lawsuits filed by the Department of Justice have pressured Google stock. Both Google’s internet search and advertising businesses are under DoJ scrutiny.
A federal judge on April 17 ruled that Google has used monopoly-building tactics to dominate online advertising. The Department of Justice had claimed Google’s dominance of the digital ad market has damaged advertisers and content creators. Alphabet said it plans to appeal.
The internet giant already is battling another antitrust lawsuit filed by the DoJ. Federal judge Amit Mehta last year ruled that Alphabet illegally maintained a monopoly over online search services and prevented rivals from developing their own products.
A key part of the ruling centered on multibillion-dollar payments that Google makes to Apple (AAPL) to be the default search engine on iPhones.
Judge Mehta is expected to decide what legal remedies are required by August. The DoJ has requested that Google be forced to sell its Chrome browser and take other measures, possibly involving Apple.
GOOGL Stock: Waymo Expands
Meanwhile, autonomous vehicle pioneer Waymo is a wild card for Google stock.
The ride-hailing service leader Waymo keeps adding to its resume with market expansions and technology advances. Yet Wall Street has yet to price in Waymo’s momentum in the valuation of Google stock.
In October, Waymo closed a $5.6 billion funding round, including Google and previous investors.
On Google’s first quarter earnings call, Alphabet disclosed that Waymo has hit 250,000 paid robotaxi rides per week in the U.S., up from 200,000 in February.
In 2024, Waymo served over 4 million fully autonomous rides across Los Angeles, San Francisco and Phoenix. The company announced plans to expand to Austin and Atlanta this year and Miami in 2026.
Also in early 2025, Waymo said it would test its self-driving taxis in more than 10 new cities across the U.S., including Las Vegas and San Diego.
Meanwhile, Alphabet’s Isomorphic Labs raised $600 million from investors. Isomorphic Labs uses AI to discover drugs. Isomorphic Lab’s valuation was not disclosed.
Spun off by Alphabet in 2022, SandboxAQ closed a $450 million funding round with the addition of Ray Dalio and Nvidia (NVDA) as backers. SandboxAQ has raised nearly $1 billion in total. The company applies quantum technology and techniques to AI development. Alphabet retains a stake.
YouTube Vs. Disney, Netflix, TikTok
In terms of possible catalysts for Google stock, some analysts see upside from YouTube. At MoffetNathanson, analyst Michael Mathanson recently declared in a report: “We crown YouTube the ‘New King of All Media’.” He noted that in 2024, YouTube was the second-
largest media company by revenue at $54.2 billion, trailing only Walt Disney (DIS). He forecasts that YouTube will surpass Disney in 2025.
“If YouTube was a standalone business, public comparisons suggest the business would be worth $475 to $550 billion, or about 30% of Alphabet’s current valuation,” Nathanson said. “This leads us to the question of what’s next and the untapped opportunity ahead. YouTube has the potential to become the central aggregator for all things professional video, positioning itself to capture a share of the $85 billion consumer pay TV market and the $30 billion streaming excluding Netflix (NFLX) market in the U.S.”
Google aims to slow down the growth of TikTok with its own short video platform. How much money Google generates from YouTube Shorts is a key issue for 2025, analysts say.
Google Stock: Is It A Buy Or Sell Now?
Whether the internet giant is a buy depends on fundamental and technical factors as well as each investor’s own goals, strategy and risk tolerance.
GOOGL stock popped 37% in 2024, though it pulled back from a high of 201.42 set on Dec. 17.
Also, the Relative Strength Rating of Alphabet stock currently stands at only 35 out of a best-possible 99, according to IBD Stock Checkup. The best stocks tend to have an RS rating of 80 or better.
Google stock holds an Accumulation/Distribution Rating of D-plus. That institutional ownership rating analyzes price and volume changes in a stock over the past 13 weeks of trading. A+ signifies heavy institutional buying; E means heavy selling. Think of a C grade as neutral.
Further, Alphabet stock holds an IBD Composite Rating of 83 out of a best possible 99. IBD’s Composite Rating is a blend of key fundamental and technical metrics to help investors gauge a stock’s strengths. The best growth stocks have a Composite Rating of 90 or better.
In the current, unpredictable market, IBD suggests stocks with ATRs of 3% or below.
Also, as of April 28, Alphabet stock needs to form a new base to be actionable.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
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