Alphabet (GOOGL) Stock Forecast & Price Target

Alphabet's financial performance demonstrates significant growth potential, highlighted by a 46% quarter-over-quarter and 79% year-over-year increase in backlog, reaching $155 billion. In addition, the Google Cloud segment has shown impressive results, with operating income climbing 85% year-over-year to $3.6 billion and operating margins improving to 23.7%, reflecting strong demand driven by AI and core products. Overall, Alphabet's consolidated revenue reached $102.3 billion, up 16% year-over-year, supported by robust contributions from Google Services and a 12% increase in revenues to $82.5 billion, underscoring the company's solid market position and diverse revenue streams.

Alphabet reported a year-over-year operating income growth of 9% for the third quarter of 2025, although this was accompanied by a decline in operating margin to 30.5%, down from previous quarters. Additionally, revenue from third-party networks has shown a consistent decline of 3% year-over-year, raising concerns regarding the sustainability of Alphabet's advertising revenue, which comprises nearly 90% of the company's earnings. Furthermore, increased competition from generative AI and alternative search methods poses a significant threat to Google's advertising dominance, coupled with ongoing regulatory scrutiny that could further undermine its financial performance.