Analysts from Wedbush, J.P. Morgan, and Bank of America predict that Google’s advancements in artificial intelligence will enhance its earnings for the second quarter, with parent company Alphabet set to announce its earnings on Tuesday.
Boeing plans to raise $19 billion amid ongoing delivery delays and labor disruptions, as the company continues to navigate significant challenges.
Bank of America analysts Justin Post and Nitin Bansal have upgraded their revenue projections for Google, attributing potential sales boosts to the integration of Gemini into Google Cloud and AI Overviews in Google Search. In a recent research note, they expressed optimism regarding growing AI integrations across Google’s ecosystem, predicting that broader implementation of AI overviews would increase engagement within the core Search business. Despite facing some issues during the initial rollout of AI overviews, which drew humor for its inaccuracies, they raised their price target for Google’s stock from $200 to $206.
Google’s first-quarter report in April showed a remarkable 60% profit increase, significantly aided by its AI initiatives, leading to a surge in its stock price and pushing its market capitalization beyond $2 trillion, joining the ranks of Apple, Microsoft, and Nvidia.
Following months of introducing new AI products under its Gemini AI offerings, Google showcased its latest innovations at the Google I/O developer conference, including a futuristic universal AI assistant capable of interacting through smart glasses. Google claims that its newest Gemini AI is 20% faster than the latest version of ChatGPT.
Dan Ives from Wedbush offered a more cautious view on AI Overviews but noted that it could contribute positively to Search monetization in the long run. He emphasized that AI is already having a positive impact on Google Cloud, predicting a 27% year-over-year increase in Cloud revenue.
Doug Anmuth from J.P. Morgan shared similar optimistic views, recently naming Google as one of the firm’s top tech stocks, alongside Uber and Amazon, citing encouragement from the progress in Generative AI ahead of Alphabet’s second-quarter earnings report.
Conversely, Raymond James analyst Josh Beck cautioned that while the current narrative surrounding Google’s AI is promising, the long-term impact of AI on Google’s sales remains uncertain.