Alphabet Q4 2024 earnings preview: revenue growth and AI impact

When is Alphabet reporting?

Alphabet is scheduled to report its fourth-quarter (Q4) 2024 earnings on Wednesday, 5 February at 8.00am AEDT, after the market closes.

Company backdrop

Alphabet, the parent company of Google, is an American multinational technology company that specialises in internet-related services and products, including search engines, online advertising, cloud computing, software, and hardware.

It is a subsidiary of Alphabet Inc., part of the ‘Magnificent Seven,’ along with Tesla, Microsoft, Nvidia, Apple, Meta, and Amazon.

Chief Executive Officer (CEO) Sundar Pichai stated, ‘The company’s momentum is extraordinary. Our innovation and artificial intelligence (AI) investments are benefiting consumers and partners. In Search, new AI features enhance search capabilities. In Cloud, AI solutions boost product adoption, attract new customers, and secure larger deals.’

Q4 2024 earnings expectations

• Revenue: $96.58 billion
• Earnings per share (EPS): $2.12

Alphabet sales revenue chart

Key highlights from Q3 2024

Alphabet's third-quarter (Q3) results, announced in late October, surpassed Wall Street's expectations, boosting its share price by 2.19% to close at $176.14.

• Revenue: $88.27 billion, exceeding the expected $86.30 billion
• EPS: $2.12, beating the forecast of $1.85
• Google Services revenues: increased by 13% to $76.5 billion, which includes ads, Android, Chrome, devices, Google Maps, Google Play, Search, and YouTube
• Google Cloud's revenues: rose by 35% to $11.4 billion, driven by growth in Google Cloud Platform's (GCP) AI infrastructure, generative AI solutions, and core GCP products.

Alphabet segment revenue breakdown chart

What else to watch for?

• Revenue growth

Monitor growth rates in core segments like Services and cloud computing, especially compared to competitors like Amazon Web Services (AWS) and Azure.

• Advertising revenue

Look for trends in advertising earnings, which are a significant part of Google's income, and consider any impacts from regulatory changes or economic factors.

• User engagement

Evaluate metrics related to user engagement on platforms like YouTube and Google Search for insights into market reach and competitiveness.

• DeepSeek

Note any mentions of DeepSeek and its potential impact on Alphabet's future.

• Guidance and outlook

Pay attention to management’s guidance and strategic outlook for 2025.

Analysts recommendations

The average one-year price target from 59 analysts is $215.95, indicating an 11.4% increase from its closing price of $193.77 on 28 January 2025.

Alphabet recommendations chart

Alphabet technical analysis

Alphabet’s share price climbed 35.13% in 2024, outperforming the Nasdaq 100, which gained 24.88%.

After reaching a record high of $202.88 in mid-December, Alphabet's share price has since been consolidating. If earnings meet or exceed expectations, the share price could rise towards the weekly trend channel resistance at around $215, a level projected from the $123.26 high in August 2022.

In the event of disappointing earnings, there is horizontal support at $190 - $185, derived from previous highs and lows. Below that, critical uptrend support is at $165 - $160, which is expected to hold if tested.

Alphabet weekly chart

• _{Source: TradingView. The figures stated are as of 28 January 2025. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}