TLDR
- Alphabet reports Q3 results after the close Wednesday, with EPS expected near $3.01 and revenue around $128 billion.
- GOOGL closed at $316.83 on Tuesday and was up about 1% in premarket trading.
- Cloud revenue is forecast to jump 91% to $28.9 billion, while ads are projected at $83.5 billion.
- Oracle will be the first outside buyer of Google’s TPU chips, and TD Cowen sees $9.4 billion in TPU sales in the second half of 2026.
- Meta’s Muse AI agent, set up by 10 million people, is a new competitor for Google Search.
Alphabet (GOOGL) closed at $316.83 on Tuesday, up 0.84%. The stock was up about 1% in premarket trading Wednesday, near $321.
The company reports third-quarter results after the close, around 4:03 pm ET. Traders want to know if the AI spending is paying off.
Analysts expect earnings per share of $2.96 to $3.02, depending on the source. Revenue is seen between $127.8 billion and $128.2 billion, up from $102.35 billion a year ago.
Alphabet has topped revenue and EPS estimates for 14 straight quarters. Wall Street will want to see number 15.
The stock is still below its May record of $408.61. It is down about 21.6% from that level and up just 1.6% in 2026.
What Analysts Want to See
Google Cloud is the main focus. Revenue is forecast to jump 91% to about $28.9 billion, with operating margins near 35%.
Advertising is projected at $83.5 billion. Revenue excluding traffic acquisition costs is expected at $111.2 billion.
Spending is the other side of the story. AI infrastructure outlays of $195 billion to $205 billion this year pushed free cash flow negative in Q2, a first since the IPO.
Chips could add a new revenue line. Oracle said Tuesday it will be the first company to buy Google’s TPUs for its own data centers.
TD Cowen’s John Blackledge expects $9.4 billion in TPU sales in the second half of 2026. He sees that rising to $62.5 billion in 2027 and $138 billion in 2028.
A source also said OpenAI plans to use Google AI chips to add computing power. BofA’s Justin Post named TPU sales and the Gemini 4 launch as possible catalysts.
Competition and Price Targets
Meta CEO Mark Zuckerberg said 10 million people have set up Muse, mostly for shopping. Post said search growth is back in focus because of the launch.
Google still holds 89.94% of the search market, per StatCounter. AI Mode passed 1 billion monthly users in Q2.
The average 12-month price target is $427.25. Needham reiterated Buy with a $450 target, and Truist kept Buy at $420.
Citizens cut its target to $450 from $515 but kept Market Outperform. LSEG data shows 54 Buy ratings, 5 Holds and no Sells.
Options markets imply a move of about 6% either way by week’s end, or roughly $303 to $338. Support sits near $315, with resistance near $352 to $357.
Last week, traders sold off CoreWeave over its debt load, which pulled parts of the market lower. Alphabet reports after the close Wednesday.
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