Two Weeks Ago I Asked If You Owned Enough Alphabet Stock. After Last Night's Earnings, You Still Don't.

Alphabet smashed expectations in Q1 2026, reporting EPS of $5.11 vs $2.63 consensus (a 94.1% beat) on $109.896B revenue (+22% YoY). Google Cloud led growth with $20.028B revenue (+63%) and backlog nearly doubling to over $460B. Management also announced selling TPU chips to select customers, positioning Alphabet against Nvidia in AI infrastructure. Shares spiked about 7% intraday (from $347.84 to $371.36) and multiple sell-side analysts raised price targets substantially, pushing many to Buy/Outperform. Risks remain — capex doubled to $35.67B, FCF fell 47%, and Alphabet flagged a $175B–$185B capex guide for 2026 — but the market reaction and analyst re-ratings point to materially higher expectations for the stock.