Overview
- Wolfe Research published its bullish 2027 call on Thursday, August 27, 2026, raising Alphabet’s 2027 revenue forecast to $595 billion and EPS to $15.89 while projecting 125% Google Cloud Platform revenue growth in Q3.
- Alphabet’s Q2 results showed Google Cloud revenue up 82% year over year to $24.8 billion, a 35.6% cloud operating margin and a reported $514 billion cloud backlog that analysts say evidences strong enterprise AI demand.
- Analysts credit Alphabet’s vertical integration — building chips, training models, running data centers and selling cloud services — as a monetization advantage that could turn AI spending into recurring revenue.
- Alphabet’s infrastructure push is costly, with Q2 capital expenditures at $44.9 billion and FY2026 guidance raised to roughly $195–$205 billion, and CFO Anat Ashkenazi warned that free cash flow will stay pressured.
- Investors remain upbeat overall, with multiple firms raising price targets, but recent senior departures and role changes at Google’s AI units add execution and margin risk that could affect near-term results.