Alphabet is going through a tough period. The company’s stock is losing value given the expected impact of the popularity of ChatGPT on its Search revenues. Search continues to be the largest contributor to Alphabet’s top-line and the visible shift towards conversational AI-based systems is going to make it difficult for the company to generate the same level of ad revenues as before. Alphabet’s result was a colossal disappointment as the company failed to meet the revenue expectations as well as the earnings expectations of Wall Street. The good thing is that it does have strong momentum in hardware, YouTube subscriptions, and the cloud. However, in this quarter, revenues were impacted by foreign exchange and pullbacks in advertiser spending. Alphabet is working to improve the hardware and economies as it focuses intently on the Pixel line and its overall cost structure. The company has been improving its YouTube shorts experience this quarter as well. We downgrade the stock of Alphabet and give it a ‘Hold’ rating with a revised target price.
Our Report Structure:
⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
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