Alphabet: Strong Buy Despite AI CapEx Fears

Alphabet Inc. delivered Q2 results with 24% revenue growth and strong AI-driven monetization across Search, Cloud, and YouTube.

GOOG's aggressive AI CapEx strategy led to negative free cash flow and raised 2026–2027 CapEx guidance, fueling investor concerns about capital intensity.

Google Cloud revenue nearly doubled to $24.8B with margin expansion, while AI tools are driving higher ad conversions and enterprise adoption.

I maintain a Strong Buy rating with a $426.68 base case price target, citing robust EBITDA growth but cautioning on prolonged free cash flow burn and halted buybacks.

Shares of Alphabet Inc. (GOOG) fell despite the company posting second quarter results that substantially exceeded analyst expectations. The market ignored the strong results and instead focused on the AI capital expenditures that pushed This article was written by Dhierin Bechai 24.35K Followers Follow Dhierin-Perkash Bechai is an aerospace, defense and airline analyst.