Google parent company Alphabet’s stock (GOOG) snapped a six-day upward streak, dipping 0.51% at Thursday’s close. This followed a dramatic 23% rebound over two weeks, with shares rising from $273 to $335. As the company approaches its April 29 earnings call, Wall Street analysts have identified two primary AI-related concerns that could influence the stock’s trajectory: the high operating costs of its new Search Generative Experience and significant capital expenditures on AI infrastructure nearing $185 billion.
The stock of **Google**’s parent company, **Alphabet**, ended a six-day rally by closing 0.51% lower on Thursday. This pause followed a substantial two-week surge where the share price climbed from $273 to approximately $335, a gain of nearly 23%.
Wall Street’s focus is now firmly on the upcoming earnings report scheduled for April 29. Two major concerns have emerged regarding Alphabet‘s investments in artificial intelligence technology. Analysts note the new ‘Search Generative Experience’ could pressure profitability.
“Wall Street is worried that the operating costs will eat up Google’s ad revenues, as the cost-to-serve is more expensive,” according to market observers. The AI-powered search summaries require significantly more computing power and electricity than traditional blue-link results.
The second issue involves significant capital expenditure on AI infrastructure. Alphabet‘s spending on data centers and custom chips is estimated between $175 billion and $185 billion. Investors are scrutinizing whether these substantial outlays will deliver corresponding returns.
Market participants will watch the earnings call for details on capital expenditure versus returns and free cash flow figures. These financial disclosures are expected to provide critical data points for the stock’s near-term direction.
