Track market-moving stories before they get noisy

Isomorphic Labs, the artificial intelligence (AI) drug discovery startup spun out of Alphabet Inc (NASDAQ:GOOG)'s Google DeepMind, is in early talks to raise new funding at a valuation of at least $40 billion.

The London-based company could be valued as high as $50 billion in the financing, although the talks are ongoing and terms could change before any deal closes, a report by Bloomberg said.

The potential valuation would represent a sharp increase from just five months ago, when Isomorphic Labs raised $2.1 billion in a Series B funding round that included substantial backing from Alphabet.

Isomorphic Labs was founded in 2021 to build on AlphaFold, DeepMind’s AI system for predicting the three-dimensional structures of proteins, a capability that can help researchers understand how potential medicines interact with biological targets.

The startup is competing with technology companies and biotechnology firms seeking to use AI to reduce the time and cost of discovering and developing new drugs.

Few AI drug discovery companies have yet progressed treatments into clinical trials, and none has brought an AI-designed medicine to market, highlighting the long development timelines and risks involved.

Chief executive Demis Hassabis, who is also Alphabet’s chief scientist and chairman of DeepMind, has said he wants to reduce the time required to develop new medicines from years to months.

Isomorphic Labs has established partnerships with Eli Lilly and Novartis to apply its drug discovery technology to pharmaceutical research, while also developing medicines internally.

The company has said it is focusing on areas including cancer and immune disorders as it seeks to turn its artificial intelligence models into potential treatments.

Hassabis shifted from leading DeepMind to a chairman role in August while remaining chief executive of Isomorphic Labs.

The latest fundraising discussions underscore the growing investor interest in AI applications beyond software, with drug discovery emerging as one of the technology’s potential high-value uses.

The barriers to entry for game creation are rapidly diminishing as AI makes game development more accessible to people without traditional programming, design, or illustration skills. The latest example is an experiment from Google Labs. 

On Wednesday, the tech giant’s public incubator and experimental platform launched a new AI-powered game-creation platform called Playground, which allows users to build browser-based games using simple text prompts, eliminating the need for coding expertise.

With Playground, creators can select a genre, such as trivia or racing, or start a project from scratch. They can specify whether they want a 2D or 3D game and choose between single-player and multiplayer experiences before describing the desired mechanics, gameplay, and visual style. Playground also allows users to upload visuals that its AI can transform into game assets tailored to the game’s overall art style.

Once created, games can be played on both mobile devices and computers. Projects can remain private, be shared through a link, or be published to Playground’s Explore gallery. Published games can support features such as leaderboards, while creators can continue modifying their projects even after they have been released.

Image Credits:Google Google also indicated that it plans to add Unity Spark integration in a future update. The integration could give Playground users access to additional 3D capabilities and “professional-level” game mechanics through Unity’s technology, further expanding what can be created through the platform.

Playground is initially available to users aged 18 and older in the U.S., with Google planning to expand availability to additional countries. Browsing and playing games in the catalog is free, while game generation relies on a weekly token system. The free tier provides a limited number of tokens, while Google One AI subscribers receive higher usage limits.

Google’s launch places Playground within a growing market of AI-assisted game-development tools. Roblox, for example, announced its own Build feature in July, enabling users to create games through natural-language prompts.

The initiative also builds on Google’s broader interest in gaming. The company previously explored cloud gaming through Stadia back in 2022, and later on continued incorporating games into other platforms, including YouTube Playables, a dedicated hub offering a selection of instantly playable web-based games.

When you purchase through links in our articles, we may earn a small commission. This doesn’t affect our editorial independence.

Lauren covers media, streaming, apps and platforms at TechCrunch.

You can contact or verify outreach from Lauren by emailing [email protected] or via encrypted message at laurenforris22.25 on Signal.

In a massive power generation deal agreed between two titans in their industries, Constellation Energy (CEG +12.25%) and Alphabet (GOOG +0.22%)(GOOGL +0.35%) have signed a pair of related long-term power purchase agreements (PPAs).

Alphabet, the parent company of eternal online search king Google, will buy 3.59 gigawatts of electricity from Constellation, the largest clean energy producer in the U.S. Of this, at least 890 megawatts will come from Constellation's nuclear assets.

This pact is already a huge boon to Constellation -- whose stock justifiably zoomed 12% higher on Tuesday following the announcement; however, we probably can't say the same for the wider nuclear industry. Let's dig into the deal to see why.

Image source: Getty Images.

Thirst for powerThe electricity will be consumed by Google, which, like many deep-pocketed and ambitious tech companies, is aiming to expand its network of artificial intelligence (AI) data centers. It's willing and able to fund a clutch of these projects with significantly increased capital expenditures (of almost $45 billion in the last reported quarter). Most of this spending is devoted to AI and advanced data center construction.

In its announcement of the deal, Constellation did not specify how much Alphabet/Google will pay for the 3.59 gigawatts of power, an immense amount by any standard. It did specify that 890 megawatts -- almost 25% of the total -- would be produced by the utility company's nuclear fleet (which, by the way, is by far the largest in this country with 21 reactors). The remainder is to be channeled through the PJM wholesale market, within which Constellation is the largest single power producer. As several of the company's nuclear plants supply PJM, it's likely the Google facilities will draw much more than that 890 megawatts from such sources.

The nuclear-exclusive part of the deal has a 20-year term. The additional 2.7 gigawatts is covered under a 15-year PPA.

Alphabet/Google isn't only getting power juice in the arrangement with Constellation. The latter company has committed to implementing Google Cloud and Alphabet's Gemini Enterprise AI solution as part of a five-year "technology alliance" to bolster its operations.

"For communities served by Constellation Energy, the aim is to use AI to reduce the costs of new infrastructure, improve performance, ensure enough power is generated to meet rising demand, and safeguard the energy grid they rely on," the electricity company wrote.

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The new age of nuclearNuclear power has enjoyed quite the resurgence in the U.S. recently, thanks largely to AI. The technology is a resource hog, requiring vast amounts of power to support the heavy computing it performs. Nuclear proponents argue that it’s the only form of energy, not to mention the sole green energy, which can service that kind of demand.

With this deal, Constellation will have plenty of coin to modernize and expand the capacity (or "uprate" in industry-speak) of its already considerable fleet -- it wrote in the press release that it'll devote a whopping $4.3 billion-plus to that purpose. Although we don’t know how much Alphabet/Google is spending on all that Constellation electricity, the amount is obviously considerable if over $4 billion from it can be allocated to plant improvements.

So, in the end, this deal pushes Constellation even higher up the ladder of both nuclear and clean-energy power producers. After all, existing and active nuclear plants in this country operate at nearly full capacity, so a meaningful expansion of the power supply would require physical engineering uprates or new builds. And with fleets that are notably smaller than Constellation's, there's only so much capacity expansion possible, even with a generous infusion of capital.

While small modular reactor (SMR) technology holds much promise, these facilities take time (and, of course, plenty of capital) to build and deploy. Some projects are in advanced stages of development, but the earliest operational targets are in 2028.

Ultimately, I'd consider this deal a monster win for Constellation. However, this assumes that collaboration with Alphabet/Google goes smoothly; that's never a guarantee in the nuclear industry, which is subject to execution risks such as regulatory hiccups, cost overruns, construction delays, and other constraints.

A federal judge just cleared billions in ad-tech damages claims against Google to proceed to trial, where antitrust law would automatically multiply whatever a jury awards. But the real threat to Alphabet shareholders may not be this case at all.

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On September 30, 2026, a federal judge in New York signed an 88-page opinion. The opinion denied most of Google’s motions to dismiss advertising-technology damages claims. That leaves about $3.2 billion in claims for a jury to hear.

The ruling was first reported on October 1, 2026. Alphabet (NASDAQ:GOOG | GOOG Price Prediction, NASDAQ:GOOGL) shares closed the most recent session at $346.47, up 0.86%.

The dollar figure is what plaintiffs seek, and US antitrust law automatically triples whatever a jury awards. No trial date has been set.

Shareholders face a key question. Can a bill this size hurt a company worth $4.2 trillion, or is the bigger risk the copycat claims that may follow?

What the Court Allowed and What It Dismissed Plaintiffs claim about $1.72 billion for a certified class of about 5,000 publishers. They also claim about $900 million for USA Today Co. (NYSE:TDAY), formerly Gannett, and about $600 million for the Daily Mail.

USA Today Co.’s chief legal counsel spoke about the ruling. He said it lets the company go after “$1 billion in worldwide damages (before trebling under the antitrust laws)”. That $1 billion figure is the company’s own framing. The opinion shows the smaller amount.

Google also won some ground. The court dismissed claims from publishers who used other advertising tools, along with a separate $479 million claim. Google said it will “defend the rest in court.”

No damages have been awarded. If a jury granted the full amount, trebling (the automatic tripling) would push it to a theoretical $9.6 billion.

How Big $9.6 Billion Is Against Alphabet Alphabet earned $40.77 billion in operating income in the second quarter of 2026 alone, on revenue of $119.80 billion. Even the tripled maximum is smaller than one quarter of operating profit.

Alphabet absorbed a $3.5 billion European Commission competition fine in its third-quarter 2025 results, which shows the company has paid penalties of this scale before.

Cash flow is where a large payment would matter. Free cash flow was -$5.855 billion in the second quarter because capital spending reached $44.924 billion.

Why Publisher Claims Are Harder to Escape A 2025 ruling in Virginia found that Google illegally monopolized parts of the ad-tech market. That finding carries over to New York, which is why the damages phase is under way. On September 2, 2026, a judge turned down a request to break up the ad business and ordered operational changes instead.

Harm from search antitrust spreads across consumers and is hard to price, but publishers are direct customers with measurable lost revenue, so a court can calculate their damages.

That makes this case a model. Other publishers can copy the structure of one large class plus two big individual plaintiffs. Future claims may matter more than this case.

What the Lawsuit Means for Alphabet’s Valuation The market’s calm looks correct. The stock trades at 23x forward earnings, and analysts hold 13 strong buys and 43 buys, with 0 sells.

For now, the case is a cost Alphabet can absorb. It would become a reason to rethink the stock only if copycat suits multiplied the exposure while free cash flow stayed negative. Then legal payments would be stacked on long-term debt that has already grown to $98.2 billion.

The business case outweighs the litigation. Google Cloud grew 82% in the second quarter, and that growth matters far more to the valuation than this litigation does.

Watch for a trial date on the schedule and the legal reserve reported with third-quarter results expected October 28, 2026. Also watch whether the stock holds its 200-day moving average of $338.92.

Contact [email protected] for any questions or corrections.

In my view, one of the most intriguing megacap artificial intelligence stocks to buy and hold over the next five years is Alphabet (GOOGL +1.20%) (GOOG +1.28%). The company has the most complete AI stack and multiple built-in advantages. With $1,000, an investor can buy three shares of the AI stock.

Throughout history, one of the biggest advantages a company can have is distribution, whether that be Coca-Cola with soda or Microsoft with its pre-installed operating system and software bundles on PCs. This is no different with AI, and that is one area where Alphabet continues to shine.

Image source: The Motley Fool.

Alphabet has essentially established itself as the gateway to the internet. This comes through its ownership of the world's most used browser and smartphone operating system, Chrome and Android, as well as a revenue-sharing deal to be the default search engine on Apple devices, which helps it capture much of the rest of the market. Thanks to this, Alphabet can get its Gemini-model-powered AI solutions front and center with consumers without them having to download separate apps or change their normal routines. Tools like AI Overviews and AI Mode bring AI directly to consumers, while its powerful two-sided ad network helps it monetize consumer AI better than new frontier model start-ups.

The company's biggest edge, though, is on the hardware side. Alphabet was at the forefront of developing custom chips to run its operation more than a decade ago, and built its entire hardware and software stack around its tensor processing units (TPUs). As a result, it now has the most powerful custom AI accelerators. This benefits it in a few ways.

First, it helps train its Gemini model and run inference at a much lower cost than companies that rely on Nvidia's graphics processing units (GPUs). Together with its distribution and ad network advantages, this puts it in a strong position in consumer AI. Second, Alphabet realizes better returns on its cloud computing investments when it uses its own chips. The company has said it expects to see a return on its AI infrastructure investments within two years, but that this is halved when it can use its own chips.

Finally, Alphabet's TPUs have proven so powerful that Anthropic has begun buying them directly for use in its own data centers. The two companies, together with co-developer partner Broadcom, signed an agreement in which Broadcom will deliver the chips to Anthropic. This creates another high-margin revenue stream for Alphabet. Altogether, Anthropic has committed to spending about $200 billion with Google Cloud over the next five years.

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Where could Alphabet trade in five years? Analysts are currently expecting solid growth from Alphabet over the next several years. The current consensus projects revenue to climb from just under $500 billion this year to $1.13 trillion in 2031. Adjusted earnings per share, meanwhile, are projected to jump from $11.81 in 2026 to $29.07 in 2021.

If we assume Alphabet's adjusted EPS grows by about 15% in 2032, that would bring it to about $33.43. The stock currently trades at a forward price-to-earnings (P/E) of nearly 29 times, but let's assume, as growth slows, that the multiple compresses a little. Placing a 20 to 25 times forward P/E multiple on the stock would have it trading between $670 and $835 in five years. A $1,000 investment would be worth between $2,000 and $2,500 in 2031. That's between a 100% return at the low end and nearly 150% at the high end.

I'd view that more as a base case, since I think the company could see greater growth in its AI infrastructure and chip business. It also has bets on robotaxis (Waymo) and quantum computing that could potentially start to pay off in five years. As such, Alphabet stock looks like a buy now.

Alphabet (GOOGL - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.

Shares of this internet search leader have returned +1.5% over the past month versus the Zacks S&P 500 composite's +0.6% change. The Zacks Internet - Services industry, to which Alphabet belongs, has gained 0.5% over this period. Now the key question is: Where could the stock be headed in the near term?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

For the current quarter, Alphabet is expected to post earnings of $2.95 per share, indicating a change of +2.8% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.9% over the last 30 days.

For the current fiscal year, the consensus earnings estimate of $20.55 points to a change of +90.1% from the prior year. Over the last 30 days, this estimate has changed +0.3%.

For the next fiscal year, the consensus earnings estimate of $14.82 indicates a change of -27.9% from what Alphabet is expected to report a year ago. Over the past month, the estimate has changed +0.5%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Alphabet.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.

For Alphabet, the consensus sales estimate for the current quarter of $111.36 billion indicates a year-over-year change of +27.3%. For the current and next fiscal years, $433.8 billion and $548.69 billion estimates indicate +26.5% and +26.5% changes, respectively.

Last Reported Results and Surprise HistoryAlphabet reported revenues of $103.62 billion in the last reported quarter, representing a year-over-year change of +26.8%. EPS of $9.11 for the same period compares with $2.31 a year ago.

Compared to the Zacks Consensus Estimate of $101.28 billion, the reported revenues represent a surprise of +2.31%. The EPS surprise was +216.32%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Alphabet is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Alphabet. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

Google has unveiled Gemini 4 Argon, its most advanced AI model yet, as competition with OpenAI and Anthropic increasingly moves beyond chatbots to systems that can carry out complex professional work with limited supervision.

The new model is designed for long, multi-step tasks across software engineering, cybersecurity, financial research, and legal work, with Google positioning it as an enterprise tool rather than simply another consumer-facing AI assistant.

One of the biggest changes is scale. Gemini 4 Argon can generate up to 1 million tokens in a single run, compared with a previous limit of 64,000, allowing it to sustain much longer reasoning processes and complete significantly more complicated tasks without interruption.

Google puts Argon to work internally

Google says thousands of its own employees are already using Argon across engineering and research.

The company has deployed teams of Argon agents to identify and implement memory-efficiency improvements across its data centres, freeing more than 300 tebibytes of memory, with total potential savings estimated at between 500 tebibytes and 1 pebibyte.

The model has also been used to migrate large C and C++ codebases into memory-safe Rust, including projects containing hundreds of thousands of lines of code.

In another example, Google said Argon improved the performance of a Rust video decoder by 2.7 times while producing identical output.

Cybersecurity capabilities trigger cautious rollout The model’s cybersecurity abilities are among its most powerful features and also one of the main reasons Google is limiting access initially.

Argon can autonomously find, validate and patch software vulnerabilities and has already identified a serious flaw affecting healthcare software used by hospitals.

Google is initially making the model available to selected cyber defenders through its Fairwind program while it gathers feedback and strengthens safeguards before a broader release.

The company is also participating in a US government process that allows authorities to evaluate advanced AI systems before wider deployment.

Price war intensifies Google is also competing aggressively on cost.

Gemini 4 Argon will launch at an introductory price of US$2 per million input tokens and US$10 per million output tokens, with standard pricing later expected to double.

That puts further pressure on OpenAI and Anthropic as developers increasingly compare frontier models not only on intelligence but also on how cheaply they can complete real-world work.

The arrival of Argon illustrates where the AI race is heading next.

The battle is no longer simply over which chatbot gives the best answer.

The next phase is about which AI system can safely perform the longest, most complex and most valuable work with the least human intervention.

Meta just handed millions of users a free AI agent while Google keeps its own locked behind a subscription, and JPMorgan says the gap between those two strategies could gut one of the most valuable revenue streams in tech.

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The AI race has moved from test rankings to personal agents on consumers’ phones. CNBC’s MacKenzie Sigalos reported that Meta Platforms (NASDAQ:META | META Price Prediction) has an estimated 5 million plus downloads for its free Muse agent three weeks after launch. Meanwhile, Alphabet (NASDAQ:GOOGL) has kept its Spark agent behind a paywall since May, and Spark still will not make calls or purchases for users.

Meta’s Free Agent Rides 3.6 Billion Users Meta CEO Mark Zuckerberg said Meta is making Muse free for a huge number of tokens and expects to earn money by taking a small fee on transactions. That plan depends on reach. In Q2 2026, daily active people across Meta’s family of apps hit 3.60 billion. On the July call, Zuckerberg described the approach:

“Rather than centralizing superintelligence, we are focused on distributing it widely and giving everyone the ability to direct it towards what matters to them.”

He added that Meta has “always focused on making our products affordable and accessible for everyone.” Usage supports the strategy. After Meta rebuilt its assistant around the Muse models, the number of people using it each day rose 60%.

Alphabet Shipped a Strong Model and Still Lost the Day Gemini 4 Argon posted strong test in coding and cyber. Even so, Alphabet shares fell 1.43% on Oct 1 after the launch. Over the past month, Meta rose 27.07%, from $571.93 to $726.78. Alphabet slipped 0.07% over the same stretch.

Alphabet’s own numbers are big. Alphabet CEO Sundar Pichai said the Gemini app has 950 million monthly active users, and Google has built its consumer AI business around paid levels:

“This was our strongest quarter ever for our consumer AI plans, driven by the Gemini App. Overall the number of paid subscriptions has now reached 350 million.”

Sigalos said she expects some kind of public Spark launch “in the next few weeks.”

Microsoft Shows What the Paid Route Earns Microsoft (NASDAQ:MSFT) is the clearest example of billing for AI up front. Microsoft 365 Copilot has passed 30 million paid seats. CEO Satya Nadella said:

“This year, Azure revenue surpassed $100 billion for the first time, and Microsoft 365 Copilot reached over 30 million paid seats.”

Meta’s free approach costs money now and pays off later, if at all. Q2 capex reached $30.12B, free cash flow fell to $784M, and EPS of $6.18 missed the $7.22 consensus estimate.

Agents That Move Money Put Google Search at Risk JPMorgan warned that agents taking over shopping and travel could cut Google Search out entirely. The bank also said Google keeps shipping AI products without a breakout consumer hit. Search and other revenue was $63.27B in Q2, so a lot of money is exposed.

Investors are already responding. Jim Cramer said that since Muse launched, a gym operator has fallen more than 18%, Booking Holdings (NASDAQ:BKNG) is down 10%, and Expedia (NASDAQ:EXPE) is down 3%.

Three things matter next: when Spark reaches the public, whether Muse transaction fees show up in Meta’s Q3 results against guidance of $61-$64B, and whether search queries keep growing as agents start booking trips.

Data Sources CNBC: Alphabet slides on Gemini 4 agent gap: Muse download estimate, Spark paywall details, JPMorgan’s warning, and Sigalos’s launch schedule. Contact [email protected] for any questions or corrections.

Google on Wednesday released its latest flagship artificial intelligence model, Gemini 4 Argon, in an effort to catch up to competitors including OpenAI and Anthropic.

It was the first significant model from Google since February, as the company saw its A.I. models fall behind rivals in overall performance and particularly in coding. Gemini 4 Argon outperformed models from OpenAI and Anthropic in coding, finance and other tasks, according to Vals AI, which evaluates the performance of A.I. technologies.

In a nod to a debate over A.I. safety that has gripped the technology world in recent weeks, Google’s new model will initially be available only to certain companies and organizations focused on cybersecurity defense, the company said. It will be released more widely after defenders have had a chance to patch their systems and remedy bugs that the model uncovers.

Google added that Gemini 4 Argon contained new guardrails to prevent misuse and unintended behavior. Those included monitoring capabilities that could catch the model if it stepped out of bounds to accomplish a task in a way that went beyond what users had intended, and could also shut down Gemini 4’s activity if it did so.

“We are seeing the guardrails be effective,” said Tulsee Doshi, a senior director and the head of product for Gemini.

Google, Meta, OpenAI and Anthropic have been under scrutiny for the dangers that cutting-edge A.I. models might pose and have faced questions about whether to slow down development of their systems. Google said this month that its models had escaped from a testing environment this summer and hacked three companies.

On Tuesday, President Trump gathered a group of executives from A.I. companies — including Sundar Pichai of Google — to sign a voluntary agreement to adopt safety policies that include risk reviews, auditing and evaluations of systems by third parties. The A.I. leaders also agreed to adopt Mr. Trump’s desired rebranding of A.I. as “super intelligence.”

(The New York Times has sued OpenAI and Microsoft, claiming copyright infringement of news content related to A.I. systems. The two companies have denied those claims.)

The debut of Gemini 4 indicated that Google no longer planned to release what it had intended to be its next flagship model, Gemini 3.5 Pro, according to Vals AI. In May, Google said it planned to release that model by June, but did not do so. The move to Gemini 4 showed that Gemini 3.5 Pro was not likely to outpace competitors’ models.

The leader in frontier A.I. models has regularly changed. In November, Google released a model that propelled it to the top of leaderboards that measure the abilities of A.I., provoking OpenAI to declare a “code red” — effectively an internal emergency — as it scrambled to catch up. Within months, OpenAI and Anthropic had again pulled ahead of Google, and the search giant faced questions about whether it could compete at the frontier.

During a call with investors in July, Mr. Pichai acknowledged the lag, but said he expected Gemini 4 would help the company compete.

“There are many attributes at which we are still at the frontier,” he said at the time.

Alphabet's (GOOGL.O) Google has challenged two EU orders to help AI rivals such as OpenAI access its services and ​search engine competitors to access its search data, saying these ‌would undermine privacy safeguards and cause irreversible harm to European users.

EU antitrust regulators ordered the US tech giant in July to help online search rivals and artificial intelligence ​developers use services available to its Gemini AI model under rules ​known as the Digital Markets Act, which is aimed at reining ⁠in Big Tech.

The challenges escalate a clash between Google and EU ​regulators over the scope of the Digital Markets Act, with the company ​arguing that compliance measures designed to open up competition would come at the cost of user privacy and security.

The changes will kick in next year. Google filed its ​challenges to the Luxembourg-based General Court, Europe's second-highest court, on Monday.

"We're ​appealing decisions that will force us to share people's private search history without sufficient ‌anonymisation ⁠and weaken vital security protections on Android," Google's senior director of competition, Oliver Bethell, said in a statement.

"People use Search for their most personal questions — from medical worries to close relationships — and mandating we share these ​personal queries without adequate ​safeguards would ⁠cause irreversible harm to user privacy," he said.

The European Commission, which enforces the DMA, has said the two ​measures contain robust safeguards protecting the privacy of users, ​device integrity ⁠and security.

DuckDuckGo, a US-based internet privacy company known for its search engine that does not track users' search history or personal data, backed the EU ⁠watchdog.

"The ​anonymization framework is robust and no amount ​of manufactured doubt changes that. The only thing an appeal buys Google is time," a DuckDuckGo ​spokesperson said.

Alphabet and Meta both poured tens of billions into AI data centers last quarter, but only one has customers writing checks in return. The gap between their payback stories is wider than the spending numbers suggest.

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Alphabet (NASDAQ:GOOGL | GOOGL Price Prediction) and Meta Platforms (NASDAQ:META) reported second-quarter results a week apart. Both are spending record sums on AI data centers. Google turned that spending into an 82% cloud surge. At Meta, it showed up as faster ad growth while costs pressured margins.

Cloud Pays Google Back as Ads Carry Meta Google Cloud revenue reached $24.77 billion, up 82%, speeding up from 63% in Q1. When outside customers pay for AI capacity, a hyperscaler has clear proof that its spending generates a return. Nearly 90% of the Fortune 100 use Gemini Enterprise, and Search grew 17% as AI features drove more queries. Operating margin expanded 2 points to 34%. A $99.03 billion unrealized equity gain inflated the $9.11 EPS figure.

Meta puts its AI to work inside the ad engine. Impressions rose 14% and price per ad increased 12%, so advertisers are paying more for better targeting. The GEM ranking model lifted Facebook conversions 15.7%. Expenses rose 55% to $42.03 billion, including $2.40 billion in legal charges and $1.18 billion in severance. Operating margin fell to 31% from 43%, and EPS of $6.18 missed the $7.22 estimate.

Business Driver Alphabet Meta Main AI Payoff Cloud revenue +82% Ad pricing +12% Q2 Capex $44.92B $30.12B Free Cash Flow -$5.86B $784M Google Sells the Shovels While Meta Builds for Itself Google’s new capacity already has paying customers. Meta’s push to sell APIs, business agents, and compute to other companies is still what Mark Zuckerberg called “somewhat of a new muscle.” He says that “there will continue to be a significantly higher margin on selling intelligence rather than selling compute directly.” That isn’t proven yet.

Google is paying for its lead with borrowed money. Long-term debt rose from $46.5 billion to $98.2 billion, and buybacks are on hold. CFO Susan Li says Meta is still “demand constrained” for compute. That makes the case for its $130 billion to $145 billion 2026 capex plan, but only if the returns show up on time. All that spending has to be powered, cooled, and networked by somebody, and we rounded up seven suppliers doing exactly that in a free AI infrastructure report.

Meta’s Business Agents Face Their First Real Test More than 1 million businesses use Meta’s business agents every week. Watch whether that shows up against Meta’s Q3 revenue guidance of $61 billion to $64 billion. For Google, watch whether cloud growth can exceed interest expense, which rose nearly 5x.

Why I Lean Toward Alphabet for AI Payback To me, Alphabet has the stronger AI return story. Equity gains support its P/E of 15. Even so, cloud revenue shows a return on capex that Meta has yet to match. Meta trades at 27 times earnings after a 30.56% one-month run. It then fell 3.33% on September 25 amid AI overspending fears. Growth investors who believe in the agent vision may prefer Meta. I want to see enterprise revenue come in first.

Contact [email protected] for any questions or corrections.

Key Takeaways Alphabet's 950M Gemini app users and 1B AI Mode users highlight its broad consumer AI reach.Gemini boosts Alphabet's ads, with AI-powered campaigns delivering an average 15% conversion or value lift.Alphabet posted 24% revenue growth, with Search up 17% and Google Cloud surging 82%. Alphabet (GOOGL - Free Report) and Apple (AAPL - Free Report) are intensifying their push into consumer artificial intelligence (AI), but their strategies differ significantly. Apple is embedding AI deeply across its hardware ecosystem through Apple Intelligence and Siri AI, while Alphabet is integrating Gemini across Search, the Gemini app, YouTube, Chrome and its broader services ecosystem.

However, GOOGL or AAPL, which has an edge right now?

The Case for GOOGL StockAlphabet’s open and cloud-centric approach has been driving the popularity of its applications among consumers. The company’s biggest advantage is the scale at which Gemini is already reaching consumers. The Gemini app reached 950 million monthly active users, while daily active users tripled year over year. AI Mode surpassed one billion monthly active users, and management said it is generating incremental Search queries. More than 140 million users also engaged with the Gemini-powered Ask YouTube feature on the watch page in June.

Gemini is also improving Alphabet’s advertising engine. The company said Gemini enhances query understanding and enables ads to address longer, more complex searches. Advertisers adopting AI-powered campaigns such as AI Max or Performance Max are seeing an average 15% increase in conversions or value at a similar return on ad spending. This provides Alphabet with a clearer near-term pathway for monetizing consumer AI usage.

Alphabet is also rapidly improving its underlying AI models. More than 9 million developers are building monthly with its models, while its APIs process roughly 22 billion tokens per minute, up from 16 billion in the previous quarter. The company is already developing Gemini 4 after introducing newer Gemini 3.5 models, highlighting the speed of its innovation cycle.

More importantly, Alphabet is converting AI adoption into revenues. In the second quarter of 2026, revenues jumped 24% year over year to $119.8 billion, while Search & Other revenues increased 17%. Google Cloud revenues surged 82% to $24.8 billion, supported by enterprise AI infrastructure and AI solutions.

The Case for AAPL StockApple benefits from its massive installed device base and vertically integrated hardware-software ecosystem. The company introduced a redesigned Siri AI, built around personal context, privacy and integration across its platforms. Apple is also running AI models both on devices and through Private Cloud Compute, allowing it to differentiate through privacy-focused AI experiences.

Apple’s silicon strategy is another strength. Management highlighted the Neural Engine, unified memory architecture and power-efficient Apple silicon as foundations for on-device AI. Mac is increasingly being used for local inference, agentic AI and demanding AI-development workloads. Meanwhile, iPhone users are increasingly using AI features powered by A19 and A19 Pro chips.

Apple’s financial position also remains robust. In the third quarter of fiscal 2026, revenues increased 16% year over year to $109.4 billion, with iPhone revenues rising 22%, Mac revenues increasing 29% and Services revenues growing 12%. Apple’s installed base reached an all-time high across major product categories and geographic segments, giving the company a large audience through which it can distribute future AI capabilities.

Apple’s current AI opportunity is still more closely tied to driving hardware upgrades, enhancing device experiences and expanding Services engagement. The company’s initiatives to develop next-generation AI capabilities that combine on-device processing with Private Cloud Compute are expected to stimulate future device upgrades.

GOOGL Earnings Estimate Revision Positive, AAPL’s SteadyThe Zacks Consensus Estimate for GOOGL’s 2026 earnings is pegged at $20.51 per share, up by a penny over the past 30 days, indicating an 89.73% increase over 2025’s reported figure.
 

The consensus mark for Apple’s fiscal 2026 earnings has been steady at $8.85 per share over the past 30 days, suggesting 18.63% growth over fiscal 2025’s reported figure.

Alphabet Shares Underperform AppleYear to date (YTD), GOOGL shares have returned 9.4%, underperforming Apple’s appreciation of 23.6%.

GOOGL and AAPL Stock’s Performance
Image Source: Zacks Investment Research

In terms of forward 12-month Price/Sales (P/S), Apple shares are trading at 9.45X, higher than Alphabet’s 8.12X.

While Apple has a Value Score of F, Alphabet carries a Value Score of C, suggesting both shares are overvalued.

AAPL and GOOGL Valuation
Image Source: Zacks Investment Research

Here is Why Alphabet Has an Edge Right NowBoth Alphabet and Apple are positioned to benefit from growing consumer AI adoption. Apple’s control over hardware, silicon and software gives it a strong foundation for privacy-focused on-device AI and could support future iPhone, Mac and Services growth. However, Alphabet currently appears further along in translating AI innovation into user growth and financial performance.

With 950 million Gemini app users, more than one billion AI Mode users, rapidly rising token consumption, 17% Search growth and 82% Cloud growth, Alphabet demonstrates both massive consumer reach and increasingly visible AI monetization. The company’s ability to deploy Gemini across Search, YouTube, advertising, Cloud and consumer applications gives GOOGL an edge over AAPL for investors seeking more direct exposure to the ongoing AI adoption cycle.

Currently, Alphabet and Apple carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

There's an odd pair of numbers tied to Alphabet (GOOGL +1.34%)(GOOG +1.20%).

The Google parent's July quarterly filing said its stakes in private companies were worth $124.3 billion at the end of the second quarter and that the figure "primarily" reflects one investment. Alphabet doesn't name the company. But Bloomberg reported that it's Anthropic, the artificial intelligence (AI) company behind the Claude models.

Anthropic, meanwhile, is reportedly looking to go public in November at a valuation of around $2 trillion.

On the surface, it can seem like Alphabet's stake is about to grow 16-fold. But the two numbers measure different things.

The $124 billion is what Alphabet's piece was worth at the latest price investors paid for Anthropic stock. The $2 trillion would be a price for the whole company. Here's what a November listing would and wouldn't change for Alphabet.

Image source: Alphabet.

The number moves in stepsAlphabet holds the stake under an accounting method for private companies with no market price: The position sits at cost and gets adjusted when an observable transaction (somebody buying identical or similar shares) resets the price.

Put another way, the $124.3 billion isn't Alphabet's guess at what Anthropic is worth. It's the value implied by the last trade in the company's stock.

The same bucket of investments was carried at $35.2 billion at the end of 2024 and $64.1 billion at the end of 2025 -- stepping up when outside investors paid higher prices. It wasn't just Anthropic back then, though. The bucket also had Alphabet's stake in SpaceX until its market debut earlier this year. The Anthropic part of the June number dates to late May, when the AI company closed a $65 billion funding round at a $965 billion valuation.

The thing that catches my eye is the cost. Alphabet's total cost of everything in that bucket is $47.6 billion. The rest is markup from other people's funding rounds.

What would a November listing change?The Wall Street Journal said on Sept. 18 that Anthropic pushed its planned initial public offering (IPO) from October to November, a delay some of its advisors wanted so investors could see third-quarter results first.

Investors reportedly expect the company to seek a valuation of roughly $2 trillion and raise up to $100 billion. Of course, these are expectations, not commitments.

Notably, Alphabet has never said what percentage of Anthropic it owns. It matters less than it seems. If Anthropic lists, Alphabet's shares get whatever price the market sets, whatever the percentage.

And a $2 trillion valuation would be roughly double the $965 billion behind the June figure -- so the stake Alphabet carries at about $124 billion could be marked at about twice that.

A listing would change the accounting, too. When Anthropic's stock has a market price, the stake moves into marketable securities, where it's repriced at the market's number each quarter. Alphabet's SpaceX shares made that same move after the rocket builder's IPO.

Paper, not cashAlphabet's second quarter already showed what these markups do to reported results. Revenue rose 24% year over year to $119.8 billion, up from 14% growth in the year-ago quarter, a pickup driven by an 82% jump in Google Cloud. Operating income climbed 30% year over year. But net income soared 298%, and earnings per share almost quadrupled to $9.11, since other income showed a $98 billion net gain, up from $2.7 billion a year before -- mainly unrealized gains on equity securities. The business didn't suddenly make four times as much money. Most of the gap was its portfolio getting marked up.

A listing around the reported target could bring another gain like that, arguably a bigger one, flowing through the same other-income line. But it wouldn't add a dollar of cash unless Alphabet sells shares, and it wouldn't raise revenue or operating income. The tax Alphabet books on these gains is mostly deferred, too.

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Still, the changes go both ways. If Anthropic's stock has a rough quarter after its debut, the drop lands in Alphabet's income statement as a loss.

What should investors take from the two numbers? I see the stake as a very large asset that could grow much larger in November, on paper, at a price Alphabet doesn't control. At the current carrying value, it's roughly 3% of Alphabet's $4.1 trillion market value.

Step back, though, and the reason to own the stock is still the operating business. At around $338 as of this writing, the stock's price-to-earnings ratio using next year's expected earnings is about 23.

If the listing headlines come, I think the right way to read that quarter's Alphabet report is with the Anthropic gain taken out. What's left is how the business is doing.

Alphabet's (GOOGL.O) Google said on Thursday it will launch a prototype satellite next week in its first in-orbit test of Project Suncatcher, ​a research effort to explore whether space could potentially host ‌large-scale AI computing infrastructure.

Companies including SpaceX (SPCX.O) and Starcloud are pursuing plans to deploy data centers in low Earth orbit, aiming to harness near-continuous sunlight to power ​energy-intensive AI computing and sidestep terrestrial constraints on electricity supplies.

The ​new mission, scheduled to fly on SpaceX's upcoming Transporter-18 rideshare ⁠launch in partnership with satellite company Planet Labs (PL.N), will assess how ​Google's AI hardware withstands launch forces, radiation and extreme temperatures in ​LEO.

After the launch, it will send a prototype satellite carrying Google Tensor Processing Units into low Earth orbit to assess if the AI chips can operate reliably ​in space.

Space radiation can disrupt or degrade electronics, including by causing ​data errors known as bit flips.

Google said it tested its TPUs while running AI ‌workloads ⁠in a facility at the University of California, Davis, but that orbital testing was needed to understand how the hardware performs in the real environment.

The company will also evaluate its design to cool the power-intensive ​chips in the ​vacuum of ⁠space, where conventional airflow cooling is impossible, by combining heat pipes with radiators.

But experts have said that the ​concept remains years from being commercially viable given ​high launch ⁠costs, engineering constraints and satellite production bottlenecks.

The first Suncatcher mission is designed to gather in-orbit data and identify potential failure points, rather than demonstrate ⁠an ​operational orbital data center, Google said.

It aims ​to launch two satellites in 2027 to test the high-bandwidth laser links needed to connect ​future computing clusters.

Alphabet GOOGL stock fell 3% on Wednesday as a broader selloff hit technology companies facing growing competition from Meta Platforms’ rapidly expanding Muse AI assistant.

The move comes after Meta shares jumped 11% on Monday as Muse climbed to the top of Apple’s US App Store.

The development has raised questions about how Alphabet’s position in consumer artificial intelligence could evolve as well-funded rivals introduce new AI products.

Muse can connect with everyday services including Gmail, Google Calendar and Google Docs, according to Meta chief AI officer Alexandr Wang.

Muse’s growing adoption has added to concerns about the potential impact of AI agents on Alphabet’s search-driven advertising business.

AI agents that can perform tasks directly for users could reduce the need to access services through traditional browsers or search interfaces.

That could create a potential challenge for the search activity that supports Alphabet’s advertising business.

Wang said on X that Muse does not feed user data into advertising systems.

The broader competitive question is how Alphabet’s AI position compares with rivals such as Meta, which is continuing to introduce consumer-facing AI products.

The recent momentum around Muse has also supported other AI-linked stocks, although technology shares were mixed on Wednesday.

Alphabet unveiled two new text-to-speech models from its Gemini 3.8 Flash series on Wednesday as the company continues to develop its own artificial intelligence products.

Gemini 3.8 Flash TTS is designed for creative applications and character development.

Google said the model can generate custom character voices and direct scene dialogue across Google AI Studio, the Gemini API, Gemini Enterprise, Gemini Notebook and Google Vids.

The model allows users to create new voices using natural-language prompts. Google said potential applications include video games, audiobooks, podcasts and other interactive media.

The company also introduced Gemini 3.8 Flash-Lite TTS, which is designed for high-volume and cost-efficient applications.

Google said the model is optimised for dubbing, audio content creation and expressive voice agents with controls for tone, pacing and other characteristics.

Both models began rolling out Wednesday.

Developers can access them through the Gemini API and Google AI Studio, while enterprise and consumer availability is being expanded through Google's other platforms.

The pressure on Alphabet stock also comes as Cathie Wood’s ARK ETFs reduced their holdings in the company.

ARKQ and ARKX collectively sold 16,422 Alphabet shares with a reported value of $5.83 million.

Alphabet’s stock has also faced broader investor questions about competition in AI and the potential effects of increasingly capable AI assistants on established internet businesses.

At the same time, Google continues to expand its own AI offerings through the Gemini family of models.

Alphabet stock has fallen around 1% over the past month while Meta shares have gained 34% in the same period.

Southern Company's (SO.N) unit, Georgia Power, said on Monday it had signed ​an agreement with Google (GOOGL.O) to support ‌upgrades at two of its nuclear plants that could add about 96 megawatts of ​electricity capacity.

The deal comes as ​surging electricity demand from data centers ⁠and other large users is driving ​interest in expanding existing nuclear plants as ​a source of round-the-clock, carbon-free power.

The agreement, pending approval from the Georgia Public Service Commission, ​would fund power upgrades at ​Georgia Power's share of the Vogtle and Hatch ‌nuclear ⁠units.

Google's subscription would enable about $900 million in projected benefits to customers over the life of the units.

The upgrades would ​involve modifications ​to ⁠equipment including turbines, pumps, motors and cooling systems, allowing the ​reactors to produce more electricity ​from ⁠existing plant infrastructure.

Georgia Power said the arrangement would help meet large customers' clean-energy ⁠goals ​while shielding non-participating customers ​from costs tied to the upgrades.

Alphabet's Google (GOOGL.O) on Monday opened pre-orders for Googlebook, its new premium laptop category ​for Android users built around the ‌company's Gemini AI tools.

Starting at $899, initial models from Acer, Asus, Dell (DELL.N), HP (HPQ.N) and Lenovo will run ​on Intel (INTC.O) or Qualcomm (QCOM.O) processors with ​up to 14 hours of battery life, ⁠the company said.

The launch comes as ​Apple (AAPL.O) moves deeper into lower-priced laptops with ​its $699 MacBook Neo, adding competition in a market where Chromebook makers have long targeted students and budget-conscious consumers ​on affordability and simplicity.

Googlebook extends that formula ​into premium laptops with more powerful hardware, AI features ‌and ⁠tighter Android integration — Google's latest push for a flagship ChromeOS showcase after the Pixelbook in 2017 and Pixelbook Go in 2019.

The ​lineup includes ​Gemini tools ⁠that can help users draft and organize text, ask questions ​about content on their screens and ​resume ⁠tasks from an Android phone.

It is built on the Android technology stack paired with desktop ⁠foundations ​from ChromeOS, aiming to ​make switching between phones and computers more seamless.

For years, Google's custom artificial intelligence (AI) chips, called tensor processing units (TPUs), could be rented through Google Cloud but not bought -- Google didn't sell them. That changed in the second quarter, when Alphabet (GOOGL +0.64%)(GOOG +0.21%) delivered TPU systems to customer data centers for the first time and began recognizing revenue from the sales.

The dollars are small so far.

Alphabet has signed only a limited number of agreements, with customers that run their own infrastructure for specialized, high-scale AI workloads. And it said the significant majority of the revenue from those deals will arrive in 2027.

Still, a new product line at a $4 trillion company is worth following.

Two stocks collect on those sales. Broadcom (AVGO +2.97%) develops and supplies the chips. And Alphabet itself books the sale -- and keeps the customer.

Image source: Getty Images.

1. Broadcom gets paid no matter who buysIn April, Broadcom disclosed a long-term agreement to develop and supply custom TPUs for Google's future generations of the chips. A second agreement has Broadcom supplying networking and other components for Google's next-generation AI racks through up to 2031. In other words, Broadcom gets paid on TPUs wherever they end up -- Google's own data centers, its cloud, or now a customer's facility.

On Broadcom's fiscal third-quarter earnings call earlier this month, CEO Hock Tan said he expects AI company Anthropic to deploy another 5 gigawatts of next-generation TPU computing capacity in 2027, after 1 gigawatt this year.

The money is already showing up. Broadcom's AI semiconductor revenue was $10.8 billion in its fiscal 2026 second quarter (ended May 3), up 143% year over year. It hit $16.7 billion in the fiscal third quarter, reported earlier this month -- growth of 221% year over year and 54% from the prior quarter. And management guided for about $21.7 billion of AI semiconductor revenue in the fiscal fourth quarter, which would be 236% growth. In short, growth is accelerating, not slowing. Helped by that momentum, Broadcom's total revenue rose 86% year over year to $29.6 billion, and free cash flow nearly doubled to $13.7 billion, or 46% of revenue.

Sure, customer concentration is arguably the stock's biggest risk. Broadcom's top five end customers accounted for about 55% of its revenue in the fiscal third quarter, and any one of them changing course could hurt. But shares cost about 18 times the earnings analysts expect for Broadcom's next fiscal year, and the stock is down about 31% from its 52-week high of $495 as of this writing. I'd argue that's an attractive price for a business growing this fast.

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2. Alphabet gets paid twiceAlphabet earns on a TPU sale in a way no chipmaker can. It books the sale itself (the systems include hardware, software, installation, and support), and the buyer stays a Google customer.

"We also began to recognize revenues from TPU system sales, which we delivered to customer data centers for the first time in Q2," chief financial officer Anat Ashkenazi said on Alphabet's second-quarter earnings call.

The same chips are doing quieter work inside Google Cloud, where customers rent TPUs instead of buying them.

Cloud revenue grew 82% year over year to $24.8 billion in the second quarter. Profitability improved even faster. The segment posted operating income of $8.8 billion, up from $2.8 billion a year earlier, and its operating margin climbed from about 21% to about 36%.

Notably, Google Cloud's backlog (which includes the TPU sales agreements) grew by more than $50 billion sequentially to $514 billion.

Of course, selling hardware typically carries lower margins than advertising or cloud services, and inventory costs from the TPU systems Alphabet sells are already lifting its cost of revenues. The spending is enormous, too: Management raised its 2026 guidance for capital expenditures to a range of $195 billion to $205 billion.

But Alphabet's forward price-to-earnings ratio sits near 23, and the stock is about 16% off its 52-week high of $408.61. That still looks reasonable to me, even with the TPU business in its early innings.

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Why I'd own bothUltimately, these two stocks are different ways of getting paid on the same systems. Broadcom collects on the chips wherever they land, and it trades at the lower forward price-to-earnings ratio of the pair. Alphabet's TPU revenue, meanwhile, is a small piece of a much larger business, with advertising profits funding the build-out.

I'd buy both stocks today.

Broadcom is the more direct play on the chips themselves, while Alphabet offers the chips plus the cloud they power. Both stocks sit well below their highs while their AI revenue accelerates. I think the pair is worth owning here.

Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) Google is securing nuclear electricity for decades as it races to expand AI infrastructure, but locking up reactor output is only one piece of the equation.

The bigger question may be what fuels those reactors: Christo Liebenberg, co-founder and president of LIS Technologies, told Benzinga in an exclusive email interview. Liebenberg noted that Big Tech is signing power deals faster than it is committing money to the nuclear fuel supply chain.

Google Locks Up Nuclear PowerGoogle announced Sept. 9 that it will invest €13 billion ($15.1 billion) in Finland over 2027 and 2028 to expand digital infrastructure, including data-center capacity. As part of the investment, Google signed a 22-year agreement covering up to 50% of the capacity of Finland’s Loviisa nuclear plant, supporting its life extension through 2050.

The deal illustrates the increasingly direct connection between AI infrastructure and nuclear power. Google is not simply building more data centers and hoping the grid can keep up; it is helping secure long-duration nuclear generation to support that expansion.

Read Next

The move also fits a broader hyperscaler trend. Alphabet, Amazon.com Inc (NASDAQ:AMZN), Meta Platforms Inc (NASDAQ:META) and Microsoft Corp (NASDAQ:MSFT) have all pursued nuclear power agreements or partnerships as AI pushes their electricity requirements higher.

A Carnegie analysis estimates those commitments could represent roughly 6.9 gigawatts of nuclear capacity by the early 2030s, although some projects depend on reactors that have yet to be commercialized.

The Fuel GapThat’s where Liebenberg’s exclusive Benzinga interview introduces a different part of the nuclear story.

"What we see are a lot of hyperscalers investing into PPA’s (power purchase agreements) with reactor companies, but very little FPA’s (fuel purchase agreements) into the nuclear fuel supply chain," Liebenberg said.

His point is not that Big Tech has no role in nuclear fuel. Rather, the financial commitment to securing electricity is becoming much more visible than commitments to the infrastructure required to produce the fuel behind that electricity.

That distinction matters because nuclear power requires a chain extending from uranium mining through conversion, enrichment and fuel fabrication. Liebenberg argues that the U.S. has underbuilt several of those stages after years of relying on foreign supply.

The issue is particularly relevant for advanced reactors, which may require specialized fuels such as HALEU. The U.S. government is already spending billions to rebuild domestic enrichment capacity, while companies including Centrus are developing additional production.

For investors, that could broaden the nuclear opportunity beyond reactor operators to uranium and fuel-cycle names such as Cameco Corp (NYSE:CCJ), Centrus Energy Corp. (NYSE:LEU) and Uranium Energy Corp. (AMEX:UEC), as demand for nuclear power increasingly puts pressure on fuel supply.

AI Needs More Than PowerLiebenberg says Big Tech and the U.S. government will need to help fund that broader infrastructure if the nuclear buildout is going to match rising electricity demand.

That creates an unusual second-order AI trade. The first wave of hyperscaler nuclear spending is helping secure power for data centers. The next question is whether some of that capital eventually moves upstream into uranium, enrichment and fuel manufacturing.

For investors, that could make the nuclear opportunity considerably broader than the reactor companies and uranium miners getting the most attention today. Google’s Loviisa deal secures the electricity; the emerging challenge is ensuring there is enough fuel infrastructure behind it to keep that electricity flowing.

Read Next

Photo Courtesy: ZikG on Shutterstock.com

© 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

A federal judge said Google should relax its rules governing its online advertising ​auctions and appoint an internal antitrust compliance monitor, though the ‌judge stopped short of demanding that the Alphabet (GOOGL.O) unit break up its advertising technology monopoly.

U.S. District Judge Leonie Brinkema in Alexandria, Virginia, gave her assessment in a decision ​unsealed on Wednesday, two weeks after she rejected the U.S. Department ​of Justice's insistence that Google break up its business of ⁠placing ads across the internet.

The government had wanted Google to sell AdX, ​where publishers pay a 20% fee to sell ads in auctions ​that happen instantly when users load websites, claiming Google could not be trusted to run it.

Brinkema accepted proposals that Google not require websites that use its ​ad server to also use its ad exchange, where the ​company reaps fees in instant auctions that sell space to advertisers. Google would also ‌cease ⁠practices that publishers complained kept them locked into Google's ad tech tools.

The remedies "will be sufficient to effectively pry open to competition the ad tech markets that were injured by Google’s unlawful conduct, and ​prevent Google from ​reverting to ⁠anticompetitive conduct in these markets," Brinkema wrote in her 106-page decision.

Changes must remain in place for six ​years, not the 15 years sought by the Justice ​Department ⁠and various states that also sued.

Google had no immediate comment. The Justice Department did not immediately respond to requests for comment.

Brinkema issued her ⁠bottom-line decision ​on September 2, but gave both ​sides 14 days to seek redactions of confidential information from her written decision.

Alphabet shares GOOGL fell about 1.7% on Tuesday as higher crude prices, elevated Treasury yields and renewed uncertainty over AI demand weighed on technology stocks.

The decline came as investors prepared for what is widely expected to be another Federal Reserve interest-rate increase.

Traders were pricing in a nearly 93% probability of a hike on Wednesday, while the benchmark 10-year US Treasury yield climbed to its highest level since 2007.

Other major technology stocks also came under pressure.

Amazon fell about 1.7%, while Microsoft declined roughly 1%.

The Roundhill Magnificent Seven ETF was down 0.8%.

The weakness came despite a recovery in semiconductor stocks following Monday's sharp selloff, suggesting investors remain selective about which parts of the AI trade they are willing to back.

The rise in Treasury yields is particularly important for technology companies because much of their valuation is based on earnings and revenue expected several years into the future.

Higher borrowing costs can make those future cash flows less valuable while increasing the cost of financing the enormous infrastructure investments required to develop and deploy AI.

The issue has become more pressing as major technology companies increasingly turn to debt markets to finance their AI build-outs.

Alphabet was reported last month to be seeking between $20 billion and $25 billion through a US bond offering, following a sharp selloff triggered by concerns around its 2026 capital spending outlook.

A regulatory filing showed that the company offered notes in as many as 10 parts, with maturities ranging from two to 40 years.

Alphabet is not alone in tapping debt markets.

Amazon, Alphabet, Meta and Oracle issued about $194 billion worth of bonds through July 7, up 79% from roughly $108 billion during the same period in 2025, according to a Reuters analysis of LSEG data.

At the same time, the hyperscalers are expected to spend more than $730 billion this year, primarily on AI.

The scale of that investment is already putting pressure on cash generation.

Alphabet reported its first-ever negative free cash flow in the second quarter in late July.

Investors are also reassessing whether the extraordinary pace of AI investment can continue as industry leaders raise concerns about the technology's risks.

AI-linked stocks suffered a global selloff on Monday after leaders of major AI companies warned about potentially existential risks associated with the technology.

Anthropic CEO Dario Amodei called on AI companies to slow the pace of model development in an essay posted on X on Saturday. Elon Musk and OpenAI CEO Sam Altman subsequently expressed agreement with Amodei.

Altman also said OpenAI would not proceed with an IPO this year, citing safety concerns.

The comments have raised questions about whether a slower pace of AI development could eventually translate into weaker infrastructure demand and lower capital spending.

However, some analysts see little evidence of an immediate slowdown.

Bank of America analyst Vivek Arya wrote in a Tuesday note that despite concerns over AI investment, "we see no signs of slowing in customer orders, [long-term agreements], capacity commitments or semis pricing."

That suggests the fundamental demand behind the AI infrastructure buildout remains intact, even as investors become increasingly sensitive to the amount companies are spending to meet it.

Despite the near-term pressure on Big Tech, some technical analysts remain optimistic about the sector's prospects.

Fundstrat believes the Magnificent Seven basket of mega-cap technology stocks is approaching a breakout that could trigger a broader rally in large-cap technology, MarketWatch reported.

"MAGS is on the verge of breaking out and looks quite positive here, with stocks like Apple, Alphabet, and Meta having all firmed up nicely in recent days," said Fundstrat's Newton.

"These look more appealing than many semiconductor names, many of which have stabilized but whose rally has proven to be a work in progress - not dissimilar to what happened to software earlier this year," he added.

According to Newton, the ETF is close to moving above the 70.80 level reached on Sept. 3.

A break above that level could trigger a sharp rally in the Nasdaq 100 and large-cap technology stocks over the following weeks.

"While Nvidia and Amazon have both weakened ever so slightly in recent days, neither has shown sufficient technical deterioration to think these cannot rally back as the Magnificent [Seven] ETF breaks out - which I see as being imminent," he concluded.

For Alphabet, the competing forces leave investors balancing two very different narratives.

Rising yields and massive AI spending are creating concerns about financing costs and cash flow, while continued customer demand and the possibility of a Magnificent Seven breakout are keeping the bullish case alive.

Key Takeaways Reddit's ad revenues jumped 64% in Q2 2026, strengthening its digital advertising growth story. Reddit Max usage rose more than 60%, while revenue from Max campaigns increased by more than 150%. Alphabet's ad revenue rose 14.4%, but tougher Search comparisons and FX headwinds may limit upside. Reddit (RDDT - Free Report) and Alphabet (GOOGL - Free Report) are major players in the digital advertising space. While Reddit is an emerging social media platform gaining traction with community-driven advertising, Alphabet remains the dominant force in global search and digital ad markets.

Reddit or Alphabet — Which of these Digital Advertising stocks has the greater upside potential? Let’s find out.

The Case for RDDT StockReddit is benefiting from strong demand in its advertising business, which has become a key growth driver of the company’s impressive financial performance and future growth prospects. In the second quarter of 2026, Reddit’s advertising revenues grew 64% year over year to $762 million, outpacing even its impressive total revenue growth of 61%. This growth is broad-based, with strength across various sales channels, including large customers, mid-market, and Small and Medium-sized Businesses (SMBs).

Reddit’s innovation in its ad stack is another key factor in strengthening its competitive edge. The launch and rapid adoption of Reddit Max, an AI-driven suite for ad automation and optimization, has delivered significant results. Advertiser usage of Max grew by more than 60% from the first quarter, and revenues from Max campaigns increased by more than 150%. Features like tailored creatives and dynamic product ads are helping brands achieve better outcomes, such as Lenovo’s 40% higher purchase value with Max campaigns compared to standard campaigns.

The company is also expanding its advertiser base and ecosystem, making it easier for businesses of all sizes to succeed on Reddit. Scaled channel revenues, which include mid-market and SMBs, doubled year over year, and active advertisers grew more than 70% in the second quarter of 2026. Integrations with platforms like Shopify and a growing ads API ecosystem are streamlining onboarding and campaign management, further fueling Reddit’s commercial momentum.

With ongoing investments in product innovation, user experience and ad technology, Reddit is poised to capture more advertising dollars and further strengthen its position in the digital ad market. For the third quarter of 2026, management expects revenues between $860 million and $870 million, representing 47% to 49% year-over-year growth.

The Case for GOOGL StockAlphabet is benefiting from strong momentum across its advertising business, supported by continued growth in Google Search and YouTube and deeper integration of Gemini across its ad infrastructure. Google advertising revenues increased 14.4% year over year to $81.63 billion in the second quarter of 2026. Google Search & other revenues jumped 17% to $63.27 billion, while YouTube advertising revenues increased 13% to $11.06 billion. Retail and finance were the biggest contributors to Search growth, while direct response and brand advertising supported YouTube.

Alphabet’s growing use of Gemini across its advertising infrastructure remains a key catalyst. Gemini helps understand longer and more detailed searches. In the second quarter of 2026, shopping ads achieved a 20% improvement in showing highly relevant advertisements. AI Max has already been adopted by 500,000 advertisers, with AI-powered campaigns generating an average of 15% more conversions or value at a similar return on ad spend.

YouTube further strengthens GOOGL’s competitive position through its combination of connected TV, Shorts, creators and direct-response advertising. Continued innovation in AI-driven targeting, shoppable formats and Search monetization should help Alphabet capture a greater share of advertising budgets despite intense competition.

Alphabet expects AI-driven improvements in Search to continue supporting user and advertiser experiences. However, third-quarter growth will face tougher Search comparisons and a slight foreign-exchange headwind, particularly across Search and YouTube ads.

Price Performance and Valuation of RDDT and GOOGLIn the year-to-date period, shares of Alphabet have gained 11.6%, whereas Reddit stock has lost 29.4%. Alphabet’s outperformance can be attributed to its continued AI push across its search, YouTube and cloud computing platforms. An expanding focus on improving the enterprise footprint is expected to boost prospects.

The decline in RDDT can be attributed to choppy and declining search referral traffic, particularly late in the second quarter of 2026, which led to a slight decrease in daily active users and heightened volatility. Low visibility into external search trends also remains a headwind.

RDDT and GOOGL Stock Performance
Image Source: Zacks Investment Research

Valuation-wise, RDDT and GOOGL shares are currently overvalued, as indicated by Value Scores of D and C, respectively.

In terms of the forward 12-month Price/Sales, RDDT shares are trading at 7.5X, which is lower than GOOGL’s 8.32X.

RDDT and GOOGL Valuation
Image Source: Zacks Investment Research

How Do Earnings Estimates Compare for RDDT & GOOGL?The Zacks Consensus Estimate for RDDT’s 2026 earnings is pegged at $5.27 per share, which has increased 0.95% over the past 30 days. This indicates a 101.15% rise year over year.

The Zacks Consensus Estimate for GOOGL’s 2026 earnings is pegged at $20.52 per share, which has increased by a penny over the past 30 days. This indicates an 89.82% year-over-year increase.

ConclusionWhile both Reddit and Alphabet offer strong digital advertising growth prospects, RDDT appears better positioned for greater upside, supported by faster ad revenue growth and expanding advertiser adoption.

Despite its dominant advertising position, Alphabet faces intensifying competition, tougher Search comparisons and near-term foreign-exchange headwinds that could limit upside.

Both Reddit and Alphabet currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

On July 22, 2026, during Alphabet's (GOOG +1.53%) (GOOGL +1.77%) earnings call, CEO Sundar Pichai said Google Cloud revenue grew 82% year over year in the second quarter, and its backlog hit $514 billion. Cloud appears on track to become Alphabet's biggest long-term growth driver -- but it isn't there yet. Search is still doing the heavy lifting, and it's still growing at a double-digit pace.

However, the cloud backlog is now larger than Alphabet's trailing 12-month revenue of $446 billion through June 30, 2026.

Search is the main growth driver today, but that massive backlog signals where the business is headed over the next decade.

Alphabet's CEO Sundar Pichai. Image source: Alphabet.

Search still produces 55% of Alphabet's total revenue Pichai opened the Q2 earnings call by saying, "Our momentum starts with Search." Users are engaging with Search through AI Overviews and AI Mode, and that's supporting advertising growth in the Search business.

Search and other advertising revenue grew 17% year over year in the second quarter of 2026, up from a 12% increase in the year-ago quarter.

On a trailing 12-month (TTM) basis, Search generated $243 billion in revenue, or 55% of the company's total. Meanwhile, Google Cloud revenue is growing much faster than Search, yet it's still small at 17% of Alphabet's TTM revenue.

Even with Cloud's operating margin reaching 35% last quarter, the segment's operating income still represents only 22% of Alphabet's total operating profit. Google Services, including Search advertising, will remain the company's core revenue and profit engine for at least a few more years.

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Pichai says both Search and Cloud have substantial growth ahead Investors shouldn't shrug off Google's search business just yet. Pichai mentioned there's still a meaningful opportunity to turn AI capabilities into better user experiences in its consumer services. The increasing user engagement and accelerating revenue growth in Search suggest that Alphabet's core business can still deliver more growth.

But it's clear from Google Cloud's growth and backlog that it will likely become the company's biggest driver of growth over the long term. Pichai noted that only a "very small percentage of overall workloads and enterprises have shifted to cloud," suggesting a long runway for Google Cloud as adoption continues. This is reflected in the backlog's growth trajectory, which surged 385% year over year in Q2.

If the $514 billion backlog keeps growing and converts into revenue at anything close to the 35% operating margin Cloud is delivering right now, the segment will contribute a significantly higher percentage of the company's profit, benefiting Google stock over the next 10 years.

Alphabet (GOOGL +1.77%)(GOOG +1.53%) entered September with an unusual streak behind it: May, June, July, and August each closed lower than the month before, the stock's longest run of monthly declines since 2015.

Shares trade around $337 as of this writing, and they sit about 18% below the 52-week high of $408.61 they set in mid-May. Even after the decline, the Google parent is worth about $4.1 trillion.

The slide would be easier to understand if the business were struggling, but it isn't. Alphabet's second-quarter report, delivered in late July, showed revenue growth accelerating and profit margins widening.

But the same report showed something investors aren't used to seeing from this company. Free cash flow turned negative, as capital spending doubled from a year earlier in support of the company's artificial intelligence (AI) build-out.

Image source: The Motley Fool.

Growth isn't the problemShowing how the business has sped up, Alphabet's second-quarter revenue rose 24% year over year to $119.8 billion -- an acceleration from 14% growth in the year-ago period and about 22% in the first quarter of 2026. Profits grew even faster. Operating income climbed 30% year over year, and the company's operating margin widened from 32% a year earlier to 34%.

The growth was broad-based, too. Google Search & other revenue rose 17% year over year, and YouTube ads revenue rose 13%. And Google Cloud revenue jumped an impressive 82% to $24.8 billion, with the segment's operating income roughly tripling to $8.8 billion.

I think the cloud profit figure is the most important number in the report. It means Google Cloud turned about 36% of its revenue into operating income, up from about 21% a year earlier. In other words, the AI capacity Alphabet keeps building is turning into revenue quickly, and at much better margins than the segment managed a year ago.

Clearly, demand isn't the issue.

Negative free cash flowThe issue is what it costs to serve that demand. Alphabet's capital expenditures were $44.9 billion in the second quarter -- double the year-ago figure, after step-ups in each of the three quarters in between.

Free cash flow went the other way. Alphabet generated $24.5 billion of it in last year's third quarter and $24.6 billion in the fourth. That fell to $10.1 billion in this year's first quarter, and the second quarter came in at negative $5.9 billion. In other words, a business that was producing about $25 billion of spare cash a quarter is, for now, consuming cash instead.

And the spending is still climbing. Management raised its full-year guidance for capital expenditures to a range of $195 billion to $205 billion, up from an earlier $180 billion to $190 billion. It also said it continues to expect capital expenditures to rise significantly in 2027.

"[W]e expect the free cash flow will remain under pressure driven by our investments in technical infrastructure," chief financial officer Anat Ashkenazi said on Alphabet's second-quarter earnings call.

How the company pays for all of this has changed, too. Operating cash flow rose 41% year over year to $39.1 billion in the second quarter, but even that can't cover a quarter's capital spending anymore.

Alphabet spent about $28 billion buying back its own stock in the first half of 2025. In the first half of 2026, it bought back none.

Instead, the company raised $49.6 billion in June by selling new stock, including a mandatory convertible preferred stock that pays a 6.25% dividend. And it ended June with $98.2 billion of long-term debt, more than double where it started the year.

Time to buy?The stock's price-to-earnings ratio of about 17 makes shares look almost cheap. That figure is misleading, though. Reported earnings have been inflated by unrealized gains on Alphabet's investments, including a $99 billion gain on equity securities that boosted second-quarter earnings per share by $6.26 all by itself.

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Based on what analysts expect the company to earn next year, Alphabet's forward price-to-earnings ratio is about 22 -- down from about 27 on those same expected earnings at the stock's mid-May high. For a company growing revenue 24% year over year with a widening operating margin, I'd argue that's a reasonable price.

So, should you buy Alphabet stock right now? I'd consider it.

The four-month sell-off has repriced the stock while the business has kept accelerating, and Google Cloud's improving profitability suggests the heavy AI spending is already earning a return.

Of course, the spending could stay ahead of the payoff for a while. Management expects higher depreciation expense from the new infrastructure to keep pressuring profits, and the capital budget is set to grow again in 2027. If Google Cloud's growth cools sharply while the spending keeps climbing, I would rethink my view. We aren't close to that today.

A university partnership shows how Google is trying to turn research access into long-term AI adoption. Summary

The school will gain access to GPU computing, Google Cloud and Nvidia infrastructure

Alphabet Inc. (GOOGL, Financials), the parent company of Google and one of the largest cloud and AI providers, is taking its infrastructure deeper into university research.

Google Public Sector is partnering with Morgan State University to build an AI-focused research campus supporting work in cybersecurity, climate science, health science and large language models.

The project will give researchers access to high-end GPU computing through Google Cloud and Nvidia infrastructure.

That is the obvious part. The longer-term opportunity is what happens after students and researchers become comfortable building on Google's technology.

Morgan State also plans to create a Google-focused Center of Excellence for AI skills and workforce training. Faculty will gain access to Google for Startups, while the university will use Google SecOps and Mandiant security tools for research requiring stricter controls.

The partnership also connects Google to Morgan State's Obsidian AI platform, including projects involving traffic and urban mobility in Baltimore. For Alphabet, these deals are small compared with multibillion-dollar cloud contracts.

But they can still matter. Training future engineers and researchers on Google Cloud can make the platform harder to replace later.

For investors, the question is whether partnerships like this can quietly translate into greater cloud adoption as universities, startups and public-sector organizations expand their AI spending.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

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