03. Alphabet Inc. (NASDAQ:GOOGL)
Return on Common Equity (TTM): 34.79%
YTD Share Price Gain as of June 23: -12.74%
Alphabet Inc. (NASDAQ:GOOGL) is making waves as one of the most dominant players in the AI space, and its Q1 2025 earnings tell a bullish story for investors. The company shattered Wall Street’s expectations with earnings per share coming in at $2.81, far ahead of the anticipated $2.01. Alphabet reported $90.2 billion in revenue (up 12% YoY) and a stunning 46% increase in net income, reaching $34.5 billion. The company also delivered free cash flow of $19 billion, reinforcing its robust financial health.
But what makes Alphabet Inc. (NASDAQ:GOOGL) a top AI stock in 2025 isn't just the numbers, it’s how deeply AI is embedded into nearly every part of its business. CEO Sundar Pichai highlighted the successful rollout of Gemini 2.5, Alphabet's most advanced AI model to date. From reasoning and coding to scientific applications, Gemini is setting new industry benchmarks. AI is now core to Google Search, YouTube, Pixel devices, and the entire Google Cloud platform.
Take Google Search, for example: its AI Overviews are now used by 1.5 billion users monthly, and the newer “AI Mode” is unlocking more complex, multimodal queries, expanding both functionality and ad reach. On the visual side, Circle to Search is now available on over 250 million devices, with usage up 40% in just one quarter.
Google Cloud, Alphabet’s AI engine room, posted 28% YoY revenue growth to $12.3 billion, outpacing the overall cloud industry. It's not just about storage or compute anymore; it’s about AI solutions at scale. The platform now offers 200+ foundation models, including Gemini 2.5, enabling enterprise customers like Verizon, Lowe’s, and KPMG to build AI agents and automate workflows.
On the hardware front, Alphabet Inc. (NASDAQ:GOOGL) launched Ironwood, a next gen TPU designed for AI inference at scale, 10x faster and nearly 2x more power efficient. That, plus its tight integration with NVIDIA’s cutting edge GPUs, gives Alphabet a hardware edge in the AI arms race.
From groundbreaking AI agents in Google Workspace to the upcoming AI driven upgrades across Android and Pixel devices, Alphabet is setting the pace for the AI era. With strong financials and relentless innovation, Alphabet Inc. (NASDAQ:GOOGL) is not just riding the AI wave, it’s helping to create it.