Alphabet Shares Surge to Unprecedented Heights on AI and Cloud Momentum

Alphabet Inc. has entered the 2026 trading year with formidable momentum, with its stock achieving a fresh record high. This performance extends an impressive run from the prior year, positioning the technology behemoth ahead of many of its peers within the elite "Magnificent Seven" cohort. The rally is fueled by a combination of robust core operations and, more significantly, aggressive advancements in two frontier sectors: artificial intelligence and autonomous driving.

A significant overhang for investors has been lifted following a pivotal court ruling. The decision confirmed that Alphabet is not required to divest its Chrome browser or Android operating system, removing a major regulatory uncertainty that had weighed on the share price. Concurrently, the company's foundational search engine business has demonstrated notable resilience, effectively countering concerns about competitive threats from AI-powered answer engines.

Gemini 3 Unleashes New Growth

Central to the current bullish sentiment is the successful launch of Gemini 3. This latest AI model has substantially strengthened Alphabet's competitive standing in the field. Market experts highlight its multimodal capabilities—simultaneously generating text, video, and imagery—as a key differentiator that provides a considerable edge against rivals like OpenAI.

User adoption metrics underscore this advantage. Following its release, monthly active users for the platform surged from 450 million to approximately 650 million. The company is also unlocking new revenue streams through strategic hardware agreements, such as supplying Tensor Processing Units (TPUs) to AI startup Anthropic.

Should investors sell immediately? Or is it worth buying Alphabet?

Cloud and Waymo Scale at Pace

Beyond pure AI software, other business units are accelerating. Google Cloud is expanding rapidly, reporting a 34 percent revenue increase in the third quarter. Particularly striking is the backlog of commitments, which nearly doubled to $155 billion. Large enterprises are committing to longer-term contracts; in the first nine months of 2025, more deals valued over $1 billion were signed than in the previous two years combined.

Simultaneously, the subsidiary Waymo is pressing forward with its expansion. Its robotaxi service, now conducting 250,000 weekly rides, is firmly established. However, the target by the end of 2026 is set at one million trips per week. A planned expansion into metropolitan areas including Los Angeles, Austin, and Atlanta underscores these ambitious growth plans.

The equity market has rewarded this confluence of positive developments. Shares closed at $315.01 on Friday, matching the 52-week peak. While the valuation, with a price-to-earnings ratio around 30, is now demanding, the combination of profitable growth and strong cash generation continues to convince Wall Street. Investors await the next major catalyst: the forthcoming quarterly earnings release scheduled for February 3, 2026.