Key Takeaways
- Alphabet’s Q2 earnings release is scheduled for Wednesday after market close, with analysts projecting $2.95 earnings per share and revenue reaching $116.98 billion
- Google Cloud Platform is anticipated to generate $22.4 billion in revenue, marking a 64% increase compared to the prior year period
- Over the past three months, Alphabet shares have climbed approximately 4%, surpassing the performance of Amazon, Meta, and Microsoft
- Recent reports indicate Google is developing “Frozen v2,” a specialized chip aimed at enhancing Gemini model processing capabilities
- Wall Street analysts maintain a Strong Buy rating on GOOGL shares, with a consensus price target of $267.53
As Wednesday’s quarterly results approach, Alphabet finds itself under intense scrutiny from investors eager to assess whether the tech giant’s substantial artificial intelligence investments are translating into meaningful revenue growth.
Financial analysts have set their expectations at $2.95 per share in earnings on total revenue of $116.98 billion for the second quarter. These projections represent significant growth from the year-ago quarter, when the company delivered $2.31 in EPS alongside $96.4 billion in revenue. When excluding traffic acquisition costs, revenue is anticipated to reach $101.5 billion.
The performance of Google Cloud Platform stands out as a critical metric for this earnings cycle. Wall Street forecasts GCP will bring in $22.4 billion, representing a substantial 64% jump from the $13.6 billion recorded in Q2 2025. The cloud division has emerged as a powerhouse growth driver as corporate clients increasingly adopt Google’s artificial intelligence solutions.
Another important indicator involves remaining performance obligations, which reflect contracted business yet to be completed. These obligations are projected to exceed $488.1 billion, showing a remarkable 351% year-over-year increase and signaling robust future demand.
Looking at stock performance, Alphabet shares have gained roughly 4% during the three-month period. This outpaces its major competitors: Amazon has remained essentially unchanged, Meta has declined nearly 6%, and Microsoft has dropped 5%.
Proprietary Chip Development Generates Buzz
Earlier this week, Alphabet received a momentum boost following a report from The Information revealing the company’s work on a proprietary chip. The project, internally designated as Frozen v2, would integrate portions of the Gemini model directly into silicon, reducing latency and boosting overall efficiency.
While Google has not publicly verified details, the disclosure contributed to positive market sentiment approaching the earnings announcement.
Separately, questions have surfaced regarding Gemini 3.5 Pro. A Bloomberg piece suggested Google had postponed the model’s release due to performance concerns versus competing offerings. Google countered this narrative, clarifying that it is “currently testing 3.5 Pro, an upgraded Flash model, and other models with partners.”
Wall Street’s Take
Professional analysts remain optimistic entering the quarterly report. JPMorgan analyst Doug Anmuth increased his price objective from $260 to $300 while reiterating a Buy rating. He highlighted Google’s favorable outcome in the DOJ search agreements litigation as eliminating a significant uncertainty, coupled with consistently strong operational performance.
Similarly, KeyBanc’s Justin Patterson elevated his target to $300 from $265, maintaining his Buy recommendation. His firm identifies positive trends across Search, Cloud, and the Waymo autonomous vehicle division, while noting the stock appears reasonably valued ā trading at merely a 1.5x premium to the S&P 500 on forward earnings multiples.
With 28 Buy ratings and 8 Hold recommendations from analysts, GOOGL commands a Strong Buy consensus rating. The mean price target among analysts stands at $267.53.
Based on options market activity, specifically the at-the-money straddle positioned at the $270 strike price, traders are anticipating a price swing of approximately 6.6% in either direction post-earnings.
Notably, Alphabet has exceeded earnings projections in all of its previous 10 quarterly reports. The upcoming results will be announced Wednesday after trading concludes.
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