Billionaire Bill Ackman’s Pershing Square Capital Management allocates 10.52% of its portfolio to Alphabet, making it the fund’s second-largest holding. As of the third quarter, this stake underscores Ackman’s confidence in Alphabet’s market leadership in search advertising and cloud computing. Alphabet’s digital ads continue to deliver robust cash flow, while its Google Cloud division reported a backlog of $155 billion at quarter end, up 46% sequentially. With more than 90% global search market share and AI-driven enhancements such as AI Overviews and AI Mode boosting query growth, Alphabet is positioned to sustain mid-teens revenue growth and high-fifties gross margins over the long term.

Alphabet has begun commercial trials of its in-house Willow quantum chip, unveiled in late 2024 with error rates that decline exponentially as qubit counts scale. In recent benchmark tests, Willow outperformed the most powerful classical supercomputers on a verifiable quantum algorithm, marking a key milestone toward practical applications. Alphabet’s ongoing investment in quantum research—backed by a multibillion-dollar R&D budget—complements its core businesses, offering investors exposure to advanced computing breakthroughs alongside stable search and cloud revenues.

Alphabet’s Google has signed three 20-year power purchase agreements with Clearway Energy totaling 1.17 gigawatts of carbon-free generation across Missouri, Texas and West Virginia. Valued at more than $2.4 billion, these agreements will support Google’s data centers in the SPP, ERCOT and PJM grids, with construction on over 1 GW of capacity starting this year and initial deliveries slated for 2027 and 2028. This deal expands Google’s contracted renewable capacity to 1.24 GW with Clearway and reflects Alphabet’s broader commitment to operating on 24/7 carbon-free energy, reducing long-term operating costs and mitigating regulatory risks associated with carbon emissions.