Alphabet's Quarter, Spending Guide, Commentary Give Little Reason to Change Our View on the Stock

Alphabet's recent quarterly performance, spending guidance, and commentary have provided investors with valuable insights into the tech giant's operations and strategic direction. While the company's revenue missed expectations, its earnings per share beat estimates, and its increased capital expenditure guidance reflects its commitment to long-term growth. Here, we'll delve into the key takeaways from Alphabet's earnings report and discuss how its commentary on AI, antitrust, and other strategic areas impacts the investment thesis for the stock.

Alphabet reported its fourth-quarter results after the bell on Tuesday, with the following key metrics:

* Revenue: $96.47 billion vs. $96.56 billion expected by LSEG
* Earnings per share: $2.15 vs. $2.13 expected by LSEG

The company's revenue missed expectations, which led to a decline in its stock price in after-hours trading. However, its earnings per share beat estimates, indicating strong profitability. Alphabet's increased capital expenditure guidance for 2025, which is expected to be even higher than the already elevated number for 2024, reflects the company's commitment to investing in artificial intelligence (AI) and cloud infrastructure.