Alphabet share price nears $4 trillion valuation on earnings strength and regulatory relief
Google's parent company has gained 70% year-to-date, outperforming tech peers as strong cloud growth and Chrome divestment ruling removal drive investor optimism.
Exceptional outperformance drives record highs
The Alphabet share price has surged since April, gaining approximately 70% year-to-date and approaching a $4 trillion valuation, as investors respond to a mix of earnings strength and reduced regulatory overhang.
Alphabet's rise reflects renewed optimism around its core businesses (search, advertising) and its cloud/AI ambitions delivering better-than-expected results.
Over the past five years the Alphabet share price gained 257% on a total annualised return basis and 259% on a total return (by re-investing dividends) basis.
Source: Alphabet
Whereas other major tech stocks took a hit over the past few weeks, Alphabet's share price continues to surge and trade at record highs.
Alphabet, Amazon, Meta, Microsoft, Tesla year-to-date comparison chart
Q3 results smash expectations
In late October, Alphabet reported quarterly results that smashed expectations. The company posted revenue of approximately US$102.35 billion for the quarter, up around 16% year-on-year (YoY).
Adjusted earnings per share (EPS) of about US$3.10 came in well ahead of the ~$2.26 consensus, demonstrating strong operational leverage.
Its cloud division recorded revenue of around US$15.16 billion (growth of roughly 34%) and the advertising business also posted strong growth (ads revenue ~US$74.18 billion).
In that context, Alphabet raised its capital-expenditure guidance for 2025 to US$91-93 billion, reflecting the company's massive investment in AI infrastructure.
Regulatory victory removes major overhang
On the regulatory front, Alphabet scored a major win in early September when a US court ruled that the company would not be forced to divest its Chrome browser or Android operating system.
Despite acknowledging antitrust violations, the decision removed a major legal overhang that had weighed on investor sentiment.
The ruling contributed to an instant ~8% share-price rally as investors reassessed the company's prospects without the threat of forced divestitures.
The combination of strong operational execution and regulatory relief has driven investor sentiment to levels not seen in years.
Valuation concerns emerge at elevated levels
The question now is whether Alphabet can sustain momentum and justify its 31.43 price to earnings (P/E) ratio and the valuation that its share price rally implies.
Some analysts caution that despite its lofty position, the company's valuation may already reflect much of the future upside.
According to LSEG Data & Analytics, Alphabet has a 'buy' rating with a mean long-term price target at $307.98, around 5% below the current share price (as of 26/11/2025).
Alphabet LSEG Data & Analytics chart
This modest downside implied by analyst targets suggests that much of the positive news may already be priced into current levels.
Its TipRanks rating is ’10 Outperform’ with a ‘strong buy’ rating (as of 26/11/2025).
Alphabet TipRanks Smart Score chart
Massive capex creates return questions
There are risks requiring careful consideration. Alphabet's capital-expenditure guidance is enormous - nearly US$90 billion this year.
The returns on those investments (in AI, cloud infrastructure, next-gen hardware) will take time to materialise and are not guaranteed.
The company's core search and advertising businesses remain exposed to macro headwinds such as slower ad-spend growth and regulatory scrutiny.
Moreover, competition in cloud and AI is intense from rivals like Microsoft and Amazon, so sustaining strong growth will not be trivial.
Sustainability questions loom
The key challenge for Alphabet is demonstrating that its massive AI and infrastructure investments will deliver commensurate returns.
Converting elevated ambitions into sustained earnings growth and cash flow becomes crucial for justifying premium valuations.
The company must also navigate ongoing regulatory attention in multiple jurisdictions, despite the recent Chrome ruling providing relief.
Execution across multiple strategic initiatives simultaneously creates complexity and potential for disappointment if any major initiative underperforms.
Alphabet technical analysis
The Alphabet share price is on track for its eights consecutive month of gains and is gunning for the 261.8% Fibonacci extension of the 2020-to-2021 $50.44-to-$151.55 advance, projected upwards from the November 2022 low at $83.34. It comes in at $348.05. Together with the psychological $350.00 mark it seems to act as a magnet.
Alphabet monthly candlestick chart
Immediate upside pressure should be maintained while the Alphabet share price stays above its mid-November low at $270.70.
Alphabet daily candlestick chart
While the next lower October low at $235.84 underpins, the medium-term uptrend is also deemed to be intact.
Investment considerations for tech giant exposure
For investors considering Alphabet following its strong performance, the company presents both momentum and valuation considerations.
- Research Alphabet's cloud growth trajectory, AI strategy, and advertising market dynamics to understand both opportunities and risks.
- Consider whether current valuation levels appropriately reflect future growth prospects or whether much upside is already priced in.
- Open an account with IG by visiting our website and completing the application process.
- Search for 'Alphabet Inc' or its ticker 'GOOGL' on our trading platform or app
- Implement appropriate risk management given technology stock volatility and elevated valuation levels.
Spread betting and CFD trading provide flexible approaches for trading Alphabet.
For longer-term investors, share dealing offers direct ownership in the technology leader.
Alphabet enters this phase with strong momentum: the market is rewarding its recent outperformance, the regulatory cloud has cleared somewhat, and its growth narrative is resonating.
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