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1 월 전
Can Alphabet's New AI and Cloud Launches Push the Stock Higher?
By: Zacks Investment Research | April 11, 2025
Alphabet GOOGL shares have lost 19.2% year to date, underperforming the broader Zacks Computer & Technology sector’s decline of 16.4%. The decline can be attributed to challenging macroeconomic conditions post U.S. President Donald Trump’s decision to levy tariffs on trade partners, including China, Mexico, and Canada.
However, GOOGL’s initiatives to infuse AI into its products are a major growth driver. Alphabet made a series of high-impact announcements at the Cloud Next 2025 conference in Las Vegas on Wednesday.
Alphabet unveiled Ironwood, its seventh-generation Tensor Processing Unit (TPU), expected to be available later this year. Ironwood promises 3,600 times better performance compared with Alphabet’s first publicly available TPU and is 29 times more energy efficient.
Google Cloud unveiled its Cloud Wide Area Network (Cloud WAN), giving enterprises access to its private global fiber network. Launching later this month, Cloud WAN delivers more than 40% faster performance while cutting ownership costs by a similar margin.
Alphabet Inc. Price and Consensus
Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote
Alphabet showcased Willow, its new quantum chip, which overcomes a key challenge in error correction. Willow reduces errors exponentially as more qubits are added, paving the way for scalable quantum computing.
On the AI model front, Alphabet launched Gemini 2.5, its most advanced reasoning model, alongside Gemini 2.5 Flash, a low-latency, cost-efficient version tailored for developers.
Alphabet’s diverse portfolio spanning Google Cloud, Search and YouTube is expected to help the stock ride over the current tumultuous phase. GOOGL’s plan to buy Wiz for a whopping $32 billion in a deal that will enhance Google Cloud’s security offerings. Wiz has a stellar clientele with its cloud security platform currently used by Amazon AMZN, Microsoft and Oracle ORCL.
Alphabet dominates the digital advertising and search business that drives advertising revenues. In fourth-quarter 2024, Google Search revenues increased 13% year over year to $54 billion, led by strength in financial services and retail, while YouTube ads increased 14% year over year to $10.5 billion. Google Cloud revenues surged 30% year over year to $12 billion, driven by core cloud products, AI infrastructure, and generative AI tools like Vertex AI and Gemini. The company is facing stiff competition from Microsoft and Amazon in the cloud domain.
Alphabet Benefits From Expanding Clientele
Alphabet continues to deepen its enterprise partnerships, fuelling growth in AI and cloud. The company recently deployed NVIDIA’s NVDA H200-based platforms to customers and was the first to announce a customer running on the highly anticipated Blackwell platform, reinforcing its strong ties with NVIDIA.
GOOGL also expanded its collaboration with Oracle, announcing an industry-first partner program and the upcoming availability of Oracle Base Database Service on Oracle Database running on Google Cloud. The service now supports Oracle Exadata X11M and offers Oracle Interconnect for U.S. Government Cloud customers. To meet rising customer demand, Oracle and Alphabet plan to expand its availability to 11 new regions over the next 12 months.
GOOGL’s Q1 to Suffer From Unfavourable Forex
Alphabet expects first-quarter 2025 revenues to suffer from unfavourable forex and one less day of revenues compared with the year-ago quarter.
The Zacks Consensus Estimate for first-quarter 2025 revenues is pegged at $75.63 billion, suggesting a 11.87% increase from the prior-year quarter’s actual.
The consensus mark for first-quarter 2025 earnings is pegged at $2.02 per share, unchanged over the past 30 days. The consensus estimate indicates a year-over-year increase of 6.88%.
Zacks Rank
Alphabet currently carries a Zacks Rank #3 (Hold).
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2 월 전
Google Acquires Wiz
By: TrendSpider | March 20, 2025
Key Takeaways
• Google’s biggest deal: $32B Wiz acquisition surpasses its $12.5B Motorola buy.
• Regulatory-driven offer hike: Google raised its bid by 39%, with a $3.2B breakup fee.
• Cybersecurity push: Wiz’s $700M revenue boosts Google against Microsoft.
Google’s Largest Acquisition: $32 Billion Deal with Wiz
Google (GOOGL) announced its largest acquisition to date, acquiring cloud security startup Wiz for $32 billion in an all-cash deal on Tuesday. The acquisition surpasses Google’s $12.5 billion Motorola Mobility purchase in 2012, reinforcing its cybersecurity position amid rising AI-driven threats.
The deal follows months of negotiations. Google initially offered $23 billion in July 2024, but Wiz considered an IPO. Unfavorable market conditions and shifting U.S. antitrust policies under President Donald Trump’s administration revived discussions. Following Trump’s January 20, 2025, inauguration, the appointment of Andrew Ferguson as FTC Chair and Gail Slater to lead antitrust reviews accelerated talks. Google increased its offer by 39% and raised the breakup fee to $3.2 billion—10% of the deal value, significantly above the 4%-7% industry standard.
Wiz’s Rapid Growth and Market Impact
Founded in 2020, Wiz has rapidly expanded, securing over 50% of Fortune 100 companies as customers. Led by CEO Assaf Rappaport, the company achieved $100 million in annual recurring revenue within 18 months. By May 2024, Wiz reached a $12 billion valuation, maintaining a 70% annual revenue growth rate and generating $700 million in annualized revenue.
Regulatory concerns initially slowed negotiations. The failed $20 billion Adobe-Figma acquisition in 2023, along with Google’s ongoing DOJ lawsuits over search and ad technology dominance, made Wiz’s largest VC backers initially cautious about regulatory risks during acquisition discussions. Former FTC Chair Lina Khan’s aggressive antitrust stance heightened regulatory fears. However, momentum shifted when Fazal Merchant joined Wiz as CFO in January 2025, playing a crucial role in final negotiations with Google Cloud chief Thomas Kurian and other executives.
Expanding Google’s Cybersecurity Investments
The acquisition comes amid a slowdown in venture-backed M&A activity. In 2024, there were 2,066 VC-backed startup exits worth $83.6 billion, but Q1 2025 saw only 382 deals totaling $13.6 billion, according to PitchBook data. The Wall Street Journal first reported on Monday that Google and Wiz were in advanced talks. With this move, Google strengthens its cybersecurity offerings against Microsoft (MSFT), which has been expanding its security portfolio.
Despite the acquisition, Wiz’s products will remain available on Amazon Web Services (AWS), Microsoft Azure, and Oracle Cloud, ensuring a broad customer base. The regulatory strategy remains uncertain. Some firms, like Tempur Sealy, preemptively consult U.S. antitrust regulators before major deals—such as its $4 billion Mattress Firm acquisition in 2023. It is unclear whether Google and Wiz took a similar approach.
With $96 billion in cash reserves, Google’s investment in Wiz signals a long-term commitment to cybersecurity leadership in an evolving digital landscape. Alphabet shares fell ~2% on Tuesday and are now down 15% for the year.
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