Key Highlights
- Alphabet shares jumped 2.8% during Monday morning hours, reaching $356.47 just ahead of its Q2 2026 results
- BMO Capital boosted its price objective to $455 while keeping an Outperform designation
- KeyBanc established a $445 target, forecasting Search and Google Cloud revenue expansion exceeding 20% until 2028
- Reports indicate Google is building a server chip called “Frozen v2” that could deliver 6-10x better efficiency versus existing TPUs
- The company’s Cloud division reported a Q1 2026 backlog approaching $462 billion, almost doubling quarter-over-quarter
Shares of Alphabet experienced a 2.8% increase during Monday’s trading session, touching $356.47, as market participants prepared for the tech giant’s second-quarter 2026 financial results scheduled for release Wednesday evening, July 22.
The upward momentum received support from multiple Wall Street firms adjusting their outlooks. BMO Capital Markets increased its price objective to $455 from a previous $435 on July 17, maintaining its Outperform designation despite emerging reports suggesting delays in the rollout of the Gemini 3.5 Pro model.
Meanwhile, KeyBanc analysts established a $445 target price. Lead analyst Justin Patterson contended that market expectations undervalue the sustained strength of both Google Cloud and Search operations, with his models showing revenue acceleration above 20% extending through 2028.
Bank of America maintained its $430 valuation while slightly adjusting its second-quarter earnings-per-share forecast upward in anticipation of the upcoming announcement.
Next-Generation “Frozen v2” Chip Development
Contributing to Monday’s positive price action, The Information published a report revealing that Google is actively developing an advanced server processor designated “Frozen v2.” Sources with direct knowledge of the project indicate the technology could deliver efficiency improvements ranging from six to ten times beyond Google’s present tensor processing units.
This efficiency measurement focuses on token processing capacity relative to power consumption—a critical benchmark for artificial intelligence operations where energy expenditure represents a substantial cost factor.
Team members involved in the development indicated the chip architecture might enable direct integration within the Gemini AI framework itself, eliminating the need for standalone hardware components. Current projections suggest the processors could enter production deployment by 2028.
A company spokesperson verified to Seeking Alpha that Google maintains ongoing “research and experimentation with new innovations,” emphasizing the organization’s “full stack approach” that involves simultaneous development of hardware and software components from initial conception.
Earlier in April, Google had introduced its eighth-generation TPU lineup—featuring the TPU 8t designed for training operations and the TPU 8i optimized for inference tasks—during a cloud computing conference held in Las Vegas.
Massive Cloud Backlog Sustains Investor Optimism
Separate from the chip revelations, Google Cloud’s first-quarter 2026 backlog totaling approximately $462 billion has maintained solid institutional conviction. This metric nearly doubled within a three-month period, a development that has sustained buying interest even as broader market concerns regarding AI infrastructure spending have pressured semiconductor stocks.
The wider market environment provided a generally favorable context on Monday. The Nasdaq Composite advanced 0.5% while the S&P 500 climbed 0.3%, partially reversing the previous week’s steep semiconductor sector decline that pushed the Philadelphia Semiconductor Index down over 20% from recent highs.
The Dow Jones Industrial Average declined 0.3%, indicating continued sector rotation from cyclical positions into large-capitalization technology names.
Alphabet’s performance exceeded that of comparable technology sector companies during Monday’s session, recovering territory surrendered during the prior week’s broad-based technology selloff.
Analyst consensus entering Wednesday’s earnings release anticipates robust results across Search advertising, YouTube operations, and Google Cloud services.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
