Alphabet Inc. Class A
Communication Services · Interactive Media & Services
Structural read: Search is a ~$200B/yr cash engine funding hyperscale capex + frontier-model R&D + Waymo + Verily. Alphabet is the only Big Tech name that owns the full AI stack end-to-end - custom silicon ($TPU v5p/v6 Trillium), hyperscale DC footprint, frontier model lab (DeepMind), distribution surface (Search/YouTube/Android, ~3B+ MAU each), and a vertically integrated autonomy program (Waymo).
- TPU silicon decouples Gemini training/inference from $NVDA H100/B200 capacity gates; reported $11B Anthropic TPU commitment validates external demand
- Google Cloud margin inflected positive in 2024, scaling 28-35% YoY with operating margin >15%
- YouTube #1 streaming surface (~10% of US TV time per Nielsen) with no Netflix-scale content cost burden
- Waymo running ~150k paid rides/week in SF/Phoenix/LA/Austin - only commercial robotaxi at scale ex-China
- $90B+ net cash, buyback ongoing
- DOJ remedies trial (Search monopoly ruling) - Chrome divestiture or default-search payout ban on table 2026-2027
- LLM answer-engines ($OPENAI ChatGPT, $PPLX) erode top-of-funnel Search query volume; Search ad CPM compression risk
- Capex >$75B/yr in 2026 pressures FCF; depreciation drag arrives 2027-2028
- Cloud still 4th in IaaS share behind $AMZN AWS, $MSFT Azure, $BABA Aliyun
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