Google Stock Near All-Time High – Will Earnings Fuel More Gains?
July 28, 2025
During the second quarter, Google once again proved why it ranks among the technological leaders. With economic results that not only exceeded analysts' expectations, but above all showed the ability to move forward even in an extremely competitive environment, the company continues to represent a promising player in the investment portfolio in the eye of investors. In addition, the stock price is still below the absolute high, which is a much better entry into the market than in the case of stocks that are at their peak.*
Source: Trading Economics*
The king of advertising with a strong cloud
Starting with the fundamentals of quarterly results, Google reported revenue of $96.43 billion, up 14% from last year, and also higher than analysts' estimates of $94 billion. In terms of revenues, the company's net profit also increased, reaching USD 28.20 billion, which represents an increase of up to 20% year-on-year. For investors, who are specifically interested in what the company generates this profit from, the data on performance in the advertising business, which is still firmly in the hands of Google with revenues exceeding USD 71 billion, is undoubtedly important. So search and YouTube are still the main components of growth, but what interested investors the most is the boom of Google Cloud. This division grew by 32% compared to last year – to USD 13.62 billion, which raises the natural question: "What is the background to such rapid growth?"
Artificial intelligence
It won't come as a surprise, but artificial intelligence is the flagship. Google's AI Overviews project has already found more than 2 billion users, while Gemini has become a must-have assistant for more than 450 million active monthly users. This solid growth is ultimately the result of the company's internal efforts, but also of strategic investments in AI startups, such as the most recently announced $2.4 billion Windsurf. Last but not least, last week, the well-known company OpenAI, which is behind the ChatGPT assistant, announced that it plans to use a cloud infrastructure mediated by Google, which undoubtedly represents additional potential for long-term sustainable growth within the prospects.
Capital expenditure and investment for the future
Despite the already relatively high costs that Google has incurred for technology development, legal affairs and cloud infrastructure, the company plans to increase this pace of investment for 2025, specifically by 10 billion to a total of $85 billion. Anat Ashkenazi, the company's CFO, commented on the increase in planned investments in development, saying: "We planned the increase in capital expenditure due to the strong and growing demand for our cloud products and services."
Conclusion
Google continues to represent an attractive investment opportunity for technology-minded investors after the latest quarterly results, based on its unquestionable fundamental strength. An additional factor highlighting Google's potential is that the share price is currently trading at levels below the absolute maximum, which is undoubtedly much more advantageous in terms of the gradual risk ratio compared to the potential return on the investment.
Warning! This marketing material is not and should not be construed as investment advice. Data relating to the past are not a guarantee of future returns. Investing in foreign currency can affect returns due to fluctuations. All securities trades can lead to both profits and losses. Forward-looking statements represent assumptions and current expectations that may not be accurate or are based on the current economic environment, which is subject to change. These statements do not guarantee future performance. InvestingFox is a trademark of CAPITAL MARKETS, o.c.p., a.s., regulated by the National Bank of Slovakia.
* Historical figures are not a guarantee of future returns.
Sources:
https://www.cnbc.com/2025/07/23/alphabet-google-q2-earnings.html
https://abc.xyz/assets/cc/27/3ada14014efbadd7a58472f1f3f4/2025q2-alphabet-earnings-release.pdf
https://www.cnbc.com/2025/02/04/alphabet-expects-to-invest-about-75-billion-in-capex-in-2025.html
https://www.cnbc.com/2025/07/16/openai-googles-cloud-chatgpt.html
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