To The Moon

$Alphabet(GOOG)$ Alphabet will be releasing its quarterly earnings results after the 4pm bell on Tue, 23 Jul 2024. It is expected to report a nearly +14% rise in quarterly revenue, its 4th straight quarter of double-digit growth, driven by (a) steady demand for its artificial intelligence-powered cloud computing services and (b) an uptick in the ad market. What To Lookout. The search giant's second-quarter report, the first among the Big Technology companies this season, could offer further insight: - Into the uptake of AI services. - (As well as) Rising costs associated with the new AI technology. AI Capabilities. At a developer conference in May 2024, Google widely rolled out AI-powered summaries in Search and beefed up its Gemini AI model to better compete with services from OpenAI and $Microsoft(MSFT)$ . Google is also (i) launching new Pixel devices with AI capabilities next month, (ii) moving forward its unveiling event, typically set in fall, after Apple announced in June 2024 — a slew of AI capabilities and an integration with ChatGPT in the latest iPhones. According to D.A. Davidson & Co, Senior software analyst — Gil Luria: - Investors will be looking for continued success in Search. - But also for signs of Google adapting to the new world of AI. The tech giant will need to show that: - AI is driving Google Cloud growth. - There are no share losses in “Search” even as users start to lean in more on AI chat. - The new models being built are competitive. AI Expenditure. Alphabet's AI investments will also be closely watched. In the January-March period, the company's capital expenditure jumped +91% to $12 billion. This has rattled some investors even though, CEO Sundar Pichai assured that AI integrations were boosting demand for its cloud and search businesses. Q2 Earnings Forecast. According to LSEG data, operating expenses for second quarter ended June are likely to rise more than +32% to $27.57 billion, its highest jump in over 2 years. Investors will also have questions around reports that Alphabet is in talks to buy cybersecurity startup Wiz for roughly $23 billion and how that would affect its bottomline. Alphabet's core businesses are likely to report healthy growth as an improving macro-economic climate gives customers the confidence to (1) invest in cloud computing and (2) spend on advertising. RBC Capital Markets, analyst Brad Erickson sees that Google search spending is still holding up fairly well. He feels advertisers need to spend as a key offset to inflation. Advertising Revenue. In June 2024, Media investment firm GroupM has raised its forecast for 2024 Global advertising growth to +7.8%, from 5.3% in December: - This is based off primarily on account of better-than-expected spending in China & the US. - Analysts also expect strong performance at YouTube, thanks in part to expanded monetization features in its TikTok-styled video offering, Shorts. According to LSEG data, Alphabet's second-quarter cloud computing sales and advertising revenue are expected to grow 26.4% and 10.8%, respectively, largely similar to the preceding two quarters. Will this set the benchmark for Ad-dependent peer $Meta Platforms, Inc.(META)$ slated to report its earnings next week Wed, 31 Jul 2024 ? My Viewpoints: (mine only) To me Google’s Gemini (answer to ChatGPT) is holding back and being conservative. When the same question is posed to both Gemini and ChatGPT, there are times when Gemini refused to answer them especially when it is deemed “politically” slanted. No such inhibitions from ChatGPT. While there is room to be prudent, Google needs to reassess (perhaps) including qualifiers to warn users on replies that require cognitive reasonings. As said, with AI infrastructure already set in placed by $NVIDIA Corp(NVDA)$ in terms of AI chips, now it is up to IT developers like Google, Microsoft & $Apple(AAPL)$ to set AI-things in motion. Based on Mon, 22 Jul 2024 performance, Google has gained back +2.21% of lost ground after last week’s massive fallout. Based on past 5 days’ performances, Google is still off by -2.91% (see above). YTD, Google is still up by +31.38%. - Do you think Google will hand in a stellar earnings report on Tue, 23 Jul 2024 ? - Do you think Google’s AI journey is smooth sailing and on schedule OR it still require a shake up? If you find this post interesting, give it wings! ️ Repost and share the insights ? Do consider “Follow me” and get firsthand read of my daily new post. Thank you. @Daily_Discussion @TigerPM @TigerStars @Tiger_SG @TigerEvents