Alphabet (GOOG, Financial) just got a fresh endorsement from Needham & Company, which raised its price target to $225 from $210. The reason? Google Cloud is on fire. After meeting with 20 CEOs at CES and the Needham Growth Conference, analysts came away even more bullish, hiking their Q4 2024 revenue forecast to $96.4 billion—a 12% jump year-over-year. But the real kicker? Cloud revenue got a 7% boost to $12.1 billion, nearly doubling its expected operating income to $2 billion. And let’s not forget Google’s advertising juggernaut—raking in over $260 billion last year and still commanding more than 40% of global digital ad spend.
Looking ahead, the momentum isn’t slowing. Needham now sees Alphabet pulling in $390.2 billion in total revenue for 2025 and $435.8 billion in 2026, each growing around 12% annually. YouTube remains the undisputed king of streaming in the U.S. and the top dog in social video advertising, while AI is set to drive even more demand for Google Cloud’s services. Needham analysts are crystal clear—Alphabet isn’t just another tech giant; it’s operating in a “winner take most” market. Even if regulators force a breakup, the parts might be worth more than the whole.
Now, all eyes are on Alphabet’s Q4 earnings drop on February 4 post-market. Wall Street is penciling in $2.12 EPS on $96.67 billion in revenue. With analysts raising targets and Alphabet firing on all cylinders, investors betting against this tech titan might want to rethink their strategy.
