On May 29, 2026, analysis highlighted the exceptional performance of Alphabet's Google Cloud, which is becoming a primary driver of the company's growth. The division reported a 63% year-over-year revenue surge to $20 billion in the first quarter, with operating income nearly tripling. This growth is largely attributed to enterprise AI solutions, with revenue from generative AI products growing almost 800% year-over-year.
The report also revealed a massive cloud backlog of approximately $462 billion, providing significant visibility into future revenue. However, on the same day, separate analysis pointed to Alphabet's stock being one of the most expensive in the U.S., with a high price-to-earnings ratio of 29 and a valuation grade of 'F', suggesting potential overvaluation concerns for investors.