Alphabet Set for Q2 Earnings as Analysts Weigh Growth Potential and Legal Risks

Google parent Alphabet is expected to report its second-quarter earnings after markets close on Wednesday, with Wall Street largely optimistic despite some unresolved regulatory overhang.

The tech giant, whose core operations span advertising, cloud computing, and AI, enters this earnings season with strong revenue expectations and a consensus that the stock still has room to grow, even as a major antitrust ruling looms next month.

Of the 19 analysts tracked by Visible Alpha, 15 currently hold a “buy” or equivalent rating on Alphabet, while four remain neutral.

The average price target stands at $201, which reflects around 5% upside from Tuesday’s intraday price of $191.

Shares of Alphabet are up just 1% year-to-date, underperforming many of its Big Tech peers, which may explain some of the recent attention around its Q2 results.

Analysts Stay Bullish Despite Sluggish Stock Performance

Jefferies analysts reiterated their bullish stance this week, maintaining a price target of $210. They pointed to Google Cloud’s continued growth, citing strong enterprise demand and an increasing footprint in AI infrastructure.

Wall Street estimates suggest cloud revenue went up 26% year-over-year to $13.12 billion in the quarter (Yahoo Finance), further cementing the unit’s role as a key growth engine.

Cloud and Advertising Lead Alphabet’s Growth Story

To defend its core search and advertising businesses, Alphabet introduced AI Overviews and improved ad targeting (Reuters). Analysts from Wedbush Securities have highlighted potential disruption from generative AI, which is slowly changing how users interact with search platforms.

However, most forecasts still show strength in Alphabet’s core business, with revenue from Search and Other expected to rise nearly 9% to $52.92 billion.

In total, analysts expect Alphabet to post $93.98 billion in revenue for the quarter, an increase of 11% from a year earlier.

Net income is projected at $26.64 billion, or $2.17 per share, compared with $23.62 billion, or $1.89 per share, in the same period last year.

Those numbers, if met or exceeded, would reinforce the narrative that Alphabet is navigating the AI shift without eroding its traditional advertising base.

But the company’s legal challenges remain a key variable. A ruling from a federal judge is expected next month in a Department of Justice antitrust case that dates back to 2024.

The court previously determined that Google had maintained an illegal monopoly in search and regulators have since argued that Alphabet should be forced to sell its Chrome browser to promote fairer market competition.

Antitrust Threat Casts Shadow Over Momentum

That uncertainty is keeping some analysts cautious. Cantor Fitzgerald maintained a neutral rating on the stock last week, saying they will stay on the sidelines “until we gain clarity” on the outcome of the antitrust decision. Nonetheless, the firm raised its price target to $196 from $171, citing Alphabet’s competitive edge in AI and its strong balance sheet.

Bank of America also weighed in with optimism, lifting its price target from $200 to $210. In a note to clients, the analysts acknowledged that the legal threat is not insignificant but said Alphabet’s fundamentals remain strong enough to support valuation expansion.

“The outlook of the antitrust ruling is the question everyone would like to ask, but Google can’t answer at this time,” the bank said.

As Alphabet prepares to release its quarterly report, investors are not just looking at top-line growth but at how well the company is transitioning into an AI-first world while protecting its dominance in legacy sectors. The outcome of that balancing act may determine whether the stock can break out of its current holding pattern.

For now, the majority of analysts believe that Alphabet has the financial strength and long-term strategy to manage both of the competitive threats and regulatory risks. But all eyes will be on the earnings call, where executives will likely be pressed for insight into AI monetization and any potential contingency planning that’s related to the DOJ case.

The next 48 hours will be telling. If Alphabet hits or beats the Street’s expectations, the stock could finally catch up to the broader tech rally of 2025. But if guidance wobbles or regulatory risks are downplayed without detail, that optimism may quickly wear thin.