About the company

Google has been around since 1998 and is one of the largest and most influential technology companies in the world. Originally focused on information retrieval on the internet, it now offers a wide range of services including email, digital maps, cloud storage and owns the world's most famous video platform, YouTube. In addition, its Android operating system is widely used, especially on mobile devices, and is a direct competitor to Apple's iOS. Google is also a leader in digital advertising, with advertising platforms such as Google Ads still its main source of revenue. It became part of parent company Alphabet Inc. after a reorganization in 2015, but remains a dominant brand within the technology industry.

Quantum computers are revolutionising IT

Google's new Willow chip has reportedly solved a problem in five minutes that would have taken the world's fastest computer 10 quadrillion years to solve. Quantum computers are revolutionising IT because their processes work differently from traditional devices. They use quantum mechanics, which deals with the behaviour and motion of the micro-particles that make up all matter. This brings with it huge potential not only for computing capacity, which will increase exponentially, but it may also solve the issue of energy intensity, which is currently plaguing technology giants such as those in the field of artificial intelligence (AI). However, experts note that quantum computers are still in the experimental phase, as the rate of miscalculations is still too high and their implementation is not yet defined. However, this is a massive advance, with other market leaders, including Microsoft and IBM, also developing quantum computers. For Google and its parent company Alphabet, it also represents an opportunity to expand its reach in the future, as it still relies heavily on revenue from the online space at present.[1][2]

Google Cloud will help airlines with data analytics

Google's domain increasingly includes Google Cloud, generating 11.4 billion USD in the last quarter to give it a 13% share of the cloud services market[3]. In early December, the division announced a partnership with Air France-KLM, in providing AI services designed to document and analyse data from all its flights. This includes information on 551 aircraft and 93 million passengers. The data processing is intended to improve service efficiency and Google says the carrier will have all the data under its control.[4]

Robotic taxis on the rise

In addition to Google, Alphabet also owns Waymo, a company that provides autonomous taxi services. Despite the still very limited operation of these technologies, they are gradually being expanded to other locations. Waymo recently added Miami to its list of US cities, and so far its robotaxis have carried passengers in Los Angeles, San Francisco, Phoenix and Austin. Competition in this area is becoming increasingly fierce on US soil, with autonomous taxi services already provided by General Motors' Cruise, Amazon's Zoox and Tesla trying to get in on the same with its recently unveiled Cybercab autonomous taxi.[5]

Economic results

At the end of October, Alphabet released its third-quarter 2024 earnings results, which showed total revenue of 88.27 billion USD, up 15% year-on-year. The company's net income rose to USD 26.3 billion, up 34% from the same period last year, and earnings per share rose 37% to USD 2.12. The Google Services segment, including search, YouTube advertising and subscription services, generated revenue of 76.5 billion USD (up 13%). The aforementioned strong growth of Google Cloud is mainly the result of the growing demand for artificial intelligence.

The shares are underpinned by consistent revenue growth

Alphabet is seeing steady growth, supported by strong financial results and increasing interest in its stock. The positive long-term outlook is in turn buoyed by huge revenues in cloud services, advertising and AI investments. Given these facts, investors view Alphabet as an attractive option, with the added benefit of low debt and dividend expansion. Currently, institutional investors own more than 27% of its shares. With a market capitalisation of 2.16 billion USD as of 10 December 2024, it maintains a strong position among the five most valuable companies in the world.[6]

Alphabet's stock price evolution over the last 5 years. (Source: Google Finance)*

Conclusion

Google is an example of a tech giant that is constantly expanding its reach. From being a leader in search and digital advertising to investing in AI, cloud services and quantum computing, the company is demonstrating its ability to adapt to market conditions and innovate. Steady financial results and growing investor interest suggest that its parent company, Alphabet, maintains a firm place among the world's most influential companies.

Adam Austera, Principal Analyst at Ozios

[1]

  https://www.bbc.com/news/articles/c791ng0zvl3o

[2]  https://www.investing.com/news/stock-market-news/google-claims-quantum-computing-leap-with-new-chip-93CH-3761935

[3]  https://www.datacenterdynamics.com/en/news/google-cloud-q3-2024-revenue-hits-114bn-data-center-spend-set-to-increase-in-2025/

[4]  https://www.investing.com/news/stock-market-news/google-cloud-partners-with-air-franceklm-on-ai-technology-3752953

[5] https://www.investing.com/news/stock-market-news/alphabets-waymo-to-expand-ridehailing-services-to-miami-3757175

[6] https://www.marketbeat.com/instant-alerts/alphabet-nasdaqgoog-shares-up-13-whats-next-2024-12-09/