After an extraordinary rally that has seen Alphabet (GOOG) (GOOGL) shares climb about 82% in just six months and propel the company to a $4 trillion market capitalization, GOOGL stock could still have room to move higher.
Much of the recent enthusiasm around Alphabet stems from its accelerating momentum in artificial intelligence (AI). The company’s latest model, Gemini 3, has strengthened Google’s position in a fiercely competitive AI landscape and boosted its long-term growth prospects. As AI adoption expands across industries, Alphabet has emerged as a foundational player in the broader AI ecosystem.
That shift is also evident in hardware. Last year, Alphabet announced a major agreement with Anthropic that grants the AI startup access to as many as one million of Google’s custom Tensor Processing Units (TPUs). Valued in the billions of dollars, the deal highlights surging demand for Google’s in-house AI chips.
Adding to the positives, The Information reported that Alphabet may also begin selling TPUs to Meta (META). These developments indicate that Google is well-positioned to monetize its AI infrastructure more effectively. If these efforts scale, they could open a significant revenue stream beyond traditional advertising, software, and cloud services.
The latest catalysts pushing Alphabet’s story forward, however, come from two high-profile partnerships with Apple (AAPL) and Walmart (WMT). Alphabet and Apple have entered into a multi-year deal under which the next generation of Apple Foundation Models will be built on Google’s Gemini models and cloud technology. These models are expected to support upcoming Apple Intelligence features, including a more personalized version of Siri scheduled to roll out this year. For Alphabet, the agreement is a strong endorsement of Gemini’s capabilities.
At the same time, Google and Walmart announced a partnership that will allow shoppers to use Gemini to discover and purchase products from Walmart and its warehouse club, Sam’s Club. The collaboration brings Google’s AI directly into the retail shopping experience, offering a large-scale use case that could drive both adoption and monetization.
Taken together, these developments strengthen the narrative that Alphabet’s AI strategy is gaining traction. As Google embeds its technology into products, platforms, and partnerships that touch billions of users, the company is poised for significant growth, which will likely drive its share price higher.
How High Could GOOGL Stock Rise in 2026?
Alphabet entered 2026 with strong momentum, driven largely by its expanding AI ecosystem. The company’s recent rollout of AI-powered features such as AI Overviews and AI Mode is improving user engagement across Google’s platforms, and these tools are expected to translate into higher advertising and product revenue over time. As search, productivity, and content discovery become increasingly AI-driven, Alphabet appears well-positioned to capture incremental growth from both consumers and advertisers.
One of the most compelling parts of the investment story is Google Cloud. The segment is delivering solid growth, with revenue rising 34% year-over-year (YoY) to $15.2 billion in the third quarter of 2025. This growth reflects strong enterprise demand for AI infrastructure and tools, and the momentum is unlikely to fade in the near term. In just the first nine months of 2025, Google signed more billion-dollar cloud contracts than it did in the prior two years combined, highlighting the scale at which large organizations are committing to its platform.
AI adoption within Google Cloud is also deepening. More than 70% of cloud customers now use Google’s AI products, while generative AI revenue has surged more than 200%.
Alphabet is also extending its AI reach into the workplace. Gemini Enterprise, its AI-powered productivity offering, has seen rapid early adoption, attracting well over two million subscribers across hundreds of companies.
Meanwhile, YouTube continues to benefit from AI-enhanced recommendations and creator tools. Advertising revenue rose 15% as engagement increased across Shorts, connected TV, and long-form content. Gemini-powered tools are helping creators produce content more efficiently, supporting YouTube’s long-term monetization potential.
Overall, Alphabet’s growth prospects remain compelling. AI-led momentum in cloud services, continued strength in search, and ongoing investment in advanced models and custom hardware support a durable earnings expansion trajectory. Against this backdrop, the stock appears to retain further upside. The highest 12-month price target for GOOGL is $400, representing approximately 19% upside from its Jan. 14 closing price of $335.84.
On the date of publication, Amit Singh did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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