The logo of Google LLC is seen at the Google Store Chelsea in Manhattan, New York City, U.S., November 17, 2021. REUTERS/Andrew Kelly/File Photorallied nearly 7% on Wednesday on signs its dominant Google Search business was faring well in an uncertain advertising market and remained unscathed in the face of competition from an AI-powered Microsoft Bing.
Wall Street analysts said the company's better-than-expected quarterly earnings showed the strong position of Google Search even as advertisers remain cautious, steady growth in the cloud business and that Google was well placed to compete with Microsoft in AI. Jefferies was among the 16 brokerages that raised their price targets, with several of them saying AI had started to contribute to Google's cloud revenue and helped drive a 28% growth in the quarter that widely surpassed expectations.
The maker of Windows also topped expectations on Tuesday, powered by growth in its Azure cloud unit - the part of its business best situated to capitalize on the booming interest in AI.