Alphabet (GOOGL) is poised for a strong earnings report, with an impressive 41% increase in the past year. Analyst Jason Helfstein from Oppenheimer notes positive trends in advertising from Meta, predicting similar outcomes for Google. Despite concerns regarding AI's impact on younger users, Helfstein believes Google has improved substantially in its AI positioning. While revenue growth expectations are lower, margin expectations remain positive, influenced by strong holiday performance and an optimistic economic outlook.
META indicated strong advertising trends and recent investor conversations suggest a favorable setup heading into results on search revenue concerns, but expecting higher margins.
We believe GOOG is in a better position with AI than many investors had expected 12-18 months ago.
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