Google Hits $4T Valuation, Why AI Spending Matters

Gotrade News - Alphabet, the parent company of Google, just released a quarterly report that smashed analyst expectations, fueled by a powerful combo of digital advertising strength and AI momentum. This latest earnings beat serves as solid proof that the tech giant isn't just surviving the AI shakeup—it is actively capitalizing on it to solidify its dominance.

The positive momentum is undeniable, with the company maintaining digital ad growth above 10 percent for the third consecutive quarter. It’s a clear signal that Google’s core business remains incredibly resilient and relevant, even as it navigates a tech landscape that looks vastly different from when it launched nearly 30 years ago.

Key Takeaways

• Alphabet’s profit surged 30 percent to $34.5 billion, driven by booming Cloud and ad revenue.

• The company plans to double down on infrastructure, projecting up to $185 billion in spending by 2026.

• Apple has officially tapped Google’s Gemini technology to power upgrades for Siri.

According to the latest report from AP News, Alphabet’s fourth-quarter profit climbed 30 percent year-over-year to hit $34.5 billion. On the top line, revenue also saw a healthy 18 percent bump, reaching $113.8 billion for the period.

Alphabet CEO Sundar Pichai highlighted that Google Search usage is higher than ever, driven by aggressive expansion of AI features. The Google Cloud division, which powers the data centers essential for these AI services, was a standout performer, posting a massive 48 percent revenue jump to $17.7 billion.

The Big Bet on AI Infrastructure

While the financials look stellar, the spotlight is heavily focused on the company's capital expenditure plans. AP News reports that Alphabet expects to double down on its investment, projecting a spending spree of up to $185 billion this year to expand its AI computing capacity.

This massive price tag caused some initial jitters, sending Alphabet’s stock see-sawing after the report dropped on Wednesday (04/02). However, market analysts view this "jarring" commitment not as panic spending, but as an offensive move to widen the gap against competitors like OpenAI.

Google’s tech supremacy got another vote of confidence after Apple struck a deal to use Gemini technology for its long-awaited Siri upgrades. This strategic partnership comes as both tech titans sit comfortably with market valuations around the $4 trillion mark.

On the regulatory front, Google caught a break when a federal judge rejected the idea of forcing a sale of the Chrome browser in the ongoing monopoly case. The decision was partly based on the view that the natural rise of AI competition will help keep the digital search market balanced without needing a breakup.

Trade the Volatility with Google Options

The market's reaction to Google’s massive spending plans creates price swings, and that volatility creates opportunity. You don’t need to wait for a steady uptrend to potentialy profit from the action.

With Options ETF GOOG, you can take a position whether you think the market will react positively (Call) or negatively (Put) to the news. It’s a way to play the volatility without just sitting on the sidelines.

That’s the market update worth watching today. Follow Gotrade News for timely coverage on US stocks, ETFs, and macro moves that shape market direction. For a structured starter guide, visit the Gotrade Blog to learn the basics and build your plan.

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Reference:

• AP News, Google’s quarterly results paint a picture of an internet powerhouse getting stronger in AI age. Diakses pada 5 Februari 2026

• Featured Image: Shutterstock