According to Similarweb data, Alphabet’s Gemini chatbot saw its share of global AI-chat traffic climb from just 5% at the start of 2025 to 18% by year-end, with newer figures pointing to a further rise to over 21% in early 2026. This surge follows the November launch of Gemini 3, which by independent reviews has markedly improved response quality and versatility. Apple’s decision to integrate Gemini into Siri underscores the technology’s momentum. Should this trajectory continue, OpenAI’s ChatGPT—once commanding roughly 87% of user traffic—may face a funding gap if its planned public offering struggles to justify a multibillion-dollar valuation, potentially slowing AI-infrastructure deals across the sector and altering capital flows into Alphabet’s core cloud business.

Alphabet’s dominance in digital advertising remains unchallenged, with Google Search and YouTube ads driving year-over-year revenue increases in the high teens, even as overall market valuations near dot-com era peaks. Simultaneously, Google Cloud’s enterprise backlog expanded to $155 billion at the end of Q4 2025, a 46% increase over the prior quarter, fueled in part by AI-related infrastructure contracts. This dual engine of high-margin advertising cash flow and long-duration cloud commitments provides a stable platform for reinvestment in next-generation AI chips, data centers and product R&D, ensuring that Alphabet can capitalize on both existing market leadership and emergent AI workloads.

Over the past decade, Alphabet has repurchased $342.4 billion of its own shares—second only to one other S&P 500 constituent—contributing to a reduced share count of approximately 12% since 2015. In the trailing twelve months through Q3 2025, the company increased repurchases to nearly $50 billion, reflecting management’s confidence in long-term cash-flow visibility and free-cash-flow yields. This substantial capital return program not only boosts earnings per share but also signals that Alphabet’s board views current valuations as an attractive entry point for long-term investors focused on total shareholder return.