Google’s parent
Alphabet
will help kick off a wave of Big Tech earnings reports when it releases second-quarter results after the market closes on Tuesday.
Investors will be parsing the report and ensuing commentary from management for signs of improvement in the advertising market, cloud spending trends, and any updates on artificial intelligence investments.
For the quarter, Wall Street analysts polled by FactSet forecast earnings of $1.34 a share and sales of $72.86 billion. Analysts expect Google advertising revenue hit $57.45 billion, while cloud revenue came in at $7.87 billion.
Alphabet shares have held up despite broader pullbacks from advertisers in the past year. The stock is up 38% year to date and 13% in the past 12 months. A wave of analysts have raised their expectations for the stock in recent weeks. The average price target on FactSet was up to $134.94 on Monday, from $131.58 at the end of June.
Though the firm held on to advertisers better than some smaller, less proven platforms, excitement about generative artificial intelligence has provided much of the fuel for the stock’s recent run.
“This topic will be a key focus of investors this week as the Street is trying to identify those tech players well positioned for this $800 billion AI Revolution that is set to transform the tech industry over the next decade,” Wedush analyst Dan Ives wrote in a Sunday note.
Though it might be too early to pick true winners and losers, investors will take any breadcrumbs they can get.
Write to Connor Smith at [email protected]
Read the full article here
