NEW: Wall Street LEFT SPEECHLESS as Google's 'AI Stack' Annihilates EPS Estimates...

Yesterday, inside our daily email “The Final Tally”, we mentioned that Alphabet was numero uno in kicking off this week's mega-cap earnings fiasco - warning everyone that if they disappointed estimates, expect somewhat of a panic within the tech sector. 

Well, after reporting after the close yesterday, do you know how they did? If not, then picture a crowd of Wall Street analysts choking on their $10 happy hour cocktails as Alphabet casually reported earnings of $2.12 per share, making their predicted $1.85 look about as accurate as a weather forecast in Oklahoma. 

(Source: Giphy) 

Naturally, this sent Alphabet’s stock soaring as much as 6% in after-hours trading because, apparently, Wall Street loves money more than AI loves data. Especially as Google’s cloud business—aka the company’s not-so-secret weapon—grew by a whopping 35%, hitting $11.35 billion in revenue. Compare that to $8.41 billion last year, and yeah, that’s what I call a bigly win. 

(Source: Yahoo Finance) 

Now for those of you not in the know, Google Cloud has been somewhat of an underdog in the cloud wars, always playing catch-up to Amazon and Microsoft. But this quarter? Alphabet showed up like it had something to prove. The cloud unit’s growth was fueled by its AI offerings, which enterprise customers are apparently eating up faster than my wife's obsession of pumpkin spice lattes in October. (She’s blonde and bougie - so no shocker there) 

(Source: Giphy) 

This of course had CEO Sundar Pichai boasting that Google’s “full stack” of AI products is now “operating at scale.” Translation: Google’s AI tech is doing everything from accelerating their Google Lens ($20B AI-powered image searches per month) to “cost cutting” (read: taking people's jobs). 

(Source: Live Mint) 

Whereas, the company’s AI-powered tools are now used by billions of people, creating what Pichai calls a “virtuous cycle.” I call it a friggin ‘money-printing machine that just so happens to be the self-fulfilling prophecy of Elon’s AI doomsday scenario. 

(Source: IBD) 

Now with that said, while the cloud business is mooning competitors left, right, and twice on Sunday - let’s not forget Alphabet’s OG ATM that keeps laying golden eggs to the tune of $49.4 billion this quarter. That’s right, the Google search business is raking it in, up 12.3% from a year ago and is still the biggest contributor to Alphabet’s bottom line. 

This, of course, continues to bring in regulators with a nice chilling batch of hatorade as they’re trying to break up the search monopoly to allow other competitors to compete. Now we’re all biting our nails to see how that will really go, but all I can say is - yeah, goodluck with that government. 

(Source: Giphy) 

Additionally, not to be outdone, YouTube even raked in $8.92 billion in ad revenue, proving that cat videos and conspiracy theories remain America's favorite pastime. According to Chief Business Officer Philipp Schindler, Google’s AI language model, Gemini, has been slaying the recommendation game, keeping users glued to their screens with fresh, personalized content. 

Meanwhile, Alphabet's "Other Bets" division (their fancy name for "stuff we're throwing money at to see what sticks") is showing signs of life. Waymo, their self-driving car project, managed to not drive itself into a financial ditch, earning $388 million in revenue - with a massive $5.6 billion raise from outside investors. 

(Source: New York Times) 

So yeah, as you can see, it was one helluva quarter for Alphabet as the tech monopoly giant is currently sitting on $26.3 billion in net income (34% YoY). Meaning, while we’re all waiting to see who will end up crashing our American Republic into the ground next week - Alphabet's over here making money faster than their AI can count it. Translation: Welcome to 2024, where the rich get richer and the algorithms get smarter, baby! 

In the meantime, you know what to do, Alphabet’s stock is expensive, but word on the street is there are some juicy call options ripe for the taking. Obviously, do what you will with that information and act accordingly - and as always stay safe and stay frosty, friends! Until next time… 

P.S. Our SURPRISE ALERT still has plenty of room to run! Click here for the details…

Stocks.News holds positions in Alphabet (Google), Amazon, and Microsoft as mentioned in the article.