Alphabet is poised to deliver another quarter of double-digit growth, with consensus forecasting a 15.5% year-over-year revenue increase for Q4 and EPS expanding by roughly 23%. Google Cloud, which grew 34% in Q3 and boosted its operating margin from 17% to 24%, is expected to maintain strong momentum and contribute substantially to overall profitability. Meanwhile, core Search and YouTube advertising revenues are projected to grow in the mid-teens, reflecting resilient ad demand and improved monetization across platforms. Investors will focus on management’s guidance for 2026 spending on data centers, AI infrastructure, and margins in Cloud and advertising segments.

Pershing Square Capital Management’s position in Alphabet has been a standout performer. Since the end of Q3 2025, the fund’s combined holding across Class A and Class C shares appreciated by over $2 billion, driven by new all-time highs in December and January. Bill Ackman originally built his stake in early 2023 when shares were trading well below their current valuation, and despite trimming 10% of his Class A shares in Q3, the position has still delivered cumulative gains of more than 200% to date. The upcoming 13F filing will reveal whether Ackman has further adjusted his exposure as the stock continues to rally.

Last year underscored Alphabet’s ability to execute at scale in an AI-first world without sacrificing its core advertising engine. The rollout of its Gemini model into Search, YouTube and Workspace moved AI from theoretical to operational, driving engagement and new monetization levers. Google Cloud emerged as a bona fide second growth pillar, with revenue up 34% and operating margins approaching 24%. Capital allocation also turned aggressive, with tens of billions invested in data centers and custom AI chips, signaling management’s commitment to long-term leadership rather than short-term margin preservation.