Alphabet Inc. shares dipped modestly in early U.S. trading Friday, reflecting broader market caution driven by surging oil prices and ongoing Middle East tensions, while investors continued to digest the company’s massive 2026 capital expenditure plans tied to artificial intelligence infrastructure.

Alphabet Class A shares (NASDAQ: GOOGL) were trading around $299.50 to $300.00 by mid-morning Eastern Time, down approximately 1.0% to 1.2% from Thursday’s close of $303.13. The stock opened near $302.50 to $303.00, with intraday action ranging from a low near $298.80 to a high of about $303.30. Volume approached 5 million to 10 million shares in early sessions, consistent with recent averages but below levels seen during high-volatility periods.

Alphabet Class C shares (NASDAQ: GOOG) moved similarly, trading near $300.00 to $300.50, down about 1.0% from the prior close around $303.45. The company’s combined market capitalization hovered near $3.65 trillion to $3.67 trillion, cementing its position among the world’s most valuable firms despite recent pullbacks.

The decline extended a pattern of consolidation after Alphabet reached multi-month highs earlier in 2026, with shares peaking near $349.00 in early February. Year-to-date performance remains positive but lags the broader S&P 500 amid concerns over heavy AI spending and competitive pressures in search and cloud computing. Over the past 12 months, GOOGL has gained significantly, up more than 70% from lows around $140 in early 2025, driven by strong revenue acceleration and AI advancements.

Recent momentum traces to Alphabet’s fourth-quarter earnings reported in early February, which beat expectations across key metrics. Revenue climbed 18% year-over-year to $113.8 billion, while adjusted earnings per share reached $2.82, surpassing consensus by about 7%. Google Cloud posted explosive 48% growth, underscoring its role as a major growth engine alongside core advertising.

Management’s guidance for 2026 capital expenditures—projected between $175 billion and $185 billion—sparked debate. The figure, roughly double 2025’s estimated $91 billion to $92 billion, prioritizes servers, data centers, and networking to support Gemini AI, cloud expansion, and other initiatives. Roughly 60% targets compute infrastructure, with the remainder for facilities.

Analysts view the spending as a bold bet on AI dominance but warn of near-term pressure on free cash flow and margins. Depreciation costs are expected to rise sharply, potentially compressing profitability even as revenue grows. Some forecasts suggest free cash flow could dip temporarily before rebounding, with optimistic scenarios projecting $55 billion to $72 billion annually in coming years if execution succeeds.

Bullish voices highlight Alphabet’s cash generation strength and positioning in AI. Google Cloud’s momentum, Gemini’s user growth beyond 750 million monthly actives, and advertising resilience provide tailwinds. Options activity has shown bullish tilt, with notable call volume at strikes near current levels for short-dated expirations, signaling trader bets on near-term recovery.

Yet challenges persist. Antitrust scrutiny, regulatory risks in multiple jurisdictions, and competition from OpenAI, Meta, and others in generative AI remain headwinds. Recent news highlighted partnerships like expanded Google Cloud collaborations with CVS Health and others, but also isolated incidents involving Waymo robotaxis and legal matters.

Broader market context amplified Friday’s softness. Oil’s surge amid Middle East conflict pressured growth stocks, with energy-sensitive sectors underperforming. The Dow and S&P 500 traded lower, while tech showed relative resilience but failed to buck the trend fully. The VIX stayed elevated, reflecting ongoing geopolitical unease.

Wall Street coverage leans positive, with consensus “Strong Buy” ratings and average price targets around $350 to $380, implying 15% to 25% upside from recent levels. Firms like Mizuho and Bank of America maintained bullish stances, citing AI opportunities despite capex concerns. Some analysts forecast potential re-rating if cloud and AI monetization accelerates.

Alphabet’s diversified revenue—advertising still dominant but cloud and other bets growing—offers resilience. Q1 earnings, expected late April, will provide updates on spending progress, Gemini adoption, and cloud margins.

For now, shares consolidate near $300 support, with traders eyeing macro developments and any AI-related catalysts. The stock’s valuation, at a forward P/E around 28, appears reasonable relative to growth prospects, though execution on capex remains key.

Investors monitor closely as Alphabet navigates AI investment phase amid volatile macro backdrop. Friday’s dip illustrates sensitivity to external risks, but fundamentals suggest long-term optimism for the tech giant.

Glen Akselrod
Bristol Capital Ltd.

The purpose of today’s presentation is to give our audience a better understanding of the business through a presentation and then questions with management. The presentation is going to be led by Raj Das Gupta, CEO, who is also joined on the call by John Gibson, CFO; and Jason Roy, VP of IR. If you’d like to get a copy of today’s presentation, simply e-mail me at glen@bristolir.com. We’ll break for questions at the end of the formal presentation. When we do break, we encourage those questions. And as a reminder, we’re only going to take questions through the webinar portal. If you’re listening over telephone, please access the web link sent earlier to ask a question.

You can submit a question using the text box within the portal at any time. I’ll ask the question on air for everyone to hear and Raj or John will answer. I’m not going to reference any names, but simply read the questions asked. And as we do have a very large audience today, if I can’t get to your question online and has not yet been addressed during the call and can’t be, I’ll come back to you by e-mail. I won’t read the forward-looking statements, but I do state that they apply, and I reference them on Page 2 of this presentation.

With that said, once again, thank you for joining us. Remember, this is fairly informal, and we do encourage questions to help you better understand the business and its growth path. And now I’ll turn the call over to

The U.S. is reportedly considering asking China to curb its purchases of oil from America’s adversaries, like Iran and Russia, ahead of President Donald Trump’s trip to Beijing at the end of the month.

The Wall Street Journal reported that Treasury Secretary Scott Bessent is weighing whether to raise the issue of China’s energy purchases with his counterpart, Vice Premier He Lifeng, when they meet in Paris mid-March. 

The Journal’s report cited people familiar with Bessent’s meetings with former U.S. officials, business executives and policy analysts about how the administration wants China to buy U.S. energy products instead.

China sources a significant portion of its oil purchases from Russia. Those purchases come at a steep discount due to international sanctions levied on Russia’s energy sector that stem from its ongoing war against Ukraine, which has been funded in part by Moscow’s oil sales. 

CHINA COULD FACE ‘REAL PROBLEMS’ WITHIN TWO MONTHS IF STRAIT OF HORMUZ CRISIS DRAGS ON, EXPERT WARNS

Treasury Secretary Scott Bessent is reportedly discussing plans to ask China to curb its purchases of Iranian and Russian oil in favor of U.S. energy. (Alex Wong/Getty Images)

It’s unclear whether China would consider paying more for American oil and potentially undermining its close ties with Russia while its strategic partner is straining to fund its war effort.

Iran is also factoring into Bessent’s consideration of energy issues related to China. The Journal’s report indicated that the Treasury chief wants China to commit to cutting back its long-term reliance on Iranian oil if Iran’s energy sector is able to resume shipments after U.S. and Israeli strikes on the country.

BURGUM SAYS US-VENEZUELA TIES MOVING AT ‘TRUMP SPEED,’ WILL HELP KEEP ENERGY COSTS DOWN FOR AMERICANS

Iran’s conflict with the U.S., Israel and other countries near the Persian Gulf has hindered the flow of oil shipments through the Strait of Hormuz. (Giuseppe Cacace/AFP via Getty Images)

China’s economy is heavily reliant on imported energy and, as of this year, imports from Russia, Iran and Venezuela made up over one-third of China’s total oil imports despite disruptions in supplies from Venezuela after the ouster of Nicolás Maduro, according to the report.

The report also noted that Bessent has said in private meetings that the Trump administration is pressing China to step up purchases of Boeing jetliners and soybeans grown in the U.S., along with a relaxation of China’s export controls on rare earth minerals.

GORDON CHANG URGES US TO TREAT CHINA AS ‘ENEMY COMBATANT,’ WARNS SUBS OPERATING ‘VERY CLOSE’ TO US

President Donald Trump and Chinese President Xi Jinping are expected to meet in Beijing within a month. (Evelyn Hockstein/Reuters)

The Chinese government put in place tough restrictions on exporting rare earths, which are elements used in a vast range of advanced technological products, in response to the White House’s tariffs.

For its part, the Chinese government is expected to press the U.S. to be more proactive in its stance against Taiwanese independence. 

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China views Taiwan, a self-governing democracy, as part of its territory even though the Chinese Communist Party has never controlled Taiwan.

The U.S. adheres to a “One China” policy that acknowledges China’s position that Taiwan is part of it but doesn’t recognize that view. By contrast, China asserts that Taiwan is its sovereign territory under the CCP’s “One China Principle.”

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President Donald Trump and Attorney General Pam Bondi on Thursday were sued over their handling of the TikTok deal that was finalized in January, according to a petition filed by two shareholders in competing tech firms.

The plaintiffs argued that Trump approved a joint venture that failed to fully sever the app’s operational ties to China, granted several unlawful extensions and that Bondi failed to investigate the alleged breaches as required by the Protecting Americans from Foreign Adversary Controlled Applications (PAFACA) Act, which mandated TikTok to divest from its Chinese parent company, ByteDance, by early 2025.

The petition was filed by Zhaocheng Anthony Tan, a shareholder in Alphabet, and Garrett Reid, a shareholder in Meta Platforms, who said the TikTok deal also led to declines in Meta and Google stock.

“For the law to mean something, it must be followed, even—perhaps especially—by the President,” the lawsuit, filed by the Public Integrity Project, stated. “Respondents have violated the statute and subverted the will of Congress. Petitioners bring this case to ensure that such violations, and such subversion, do not continue.”

TIKTOK AVOIDS US BAN BY FINALIZING HISTORIC TRUMP-BACKED AMERICAN MAJORITY OWNERSHIP DEAL

Trump in January backed the launch of The Joint Venture LLC, a seven-member majority-American board that enabled TikTok to keep operating in the U.S. (Getty Images)

Under the current agreement, TikTok was spun off into a separate U.S.-owned entity to remain operational in the country, satisfying an executive order issued by Trump on Sept. 25 of last year. The majority American-owned joint venture gives U.S. entities an 80.1% stake, while parent company ByteDance retains 19.9%.

“In short, under the announced deal, ByteDance would still control all the essential elements of TikTok,” the lawsuit said. “Such a deal would subvert the very purpose of the TikTok Law, as ByteDance could continue to push Chinese propaganda and censor the content it does not like, exactly the harm that the law was intended to prevent.”

TIKTOK REACHES AGREEMENTS ON NEW US JOINT VENTURE WITH CLOSING SET FOR 2026

Attorney General Pam Bondi conducts a news conference at the Department of Justice on Thursday, Dec. 4, 2025. (Tom Williams/CQ-Roll Call, Inc via Getty Images)

According to the lawsuit, the American entity of TikTok does not actually own the app’s algorithm but instead collaborates with ByteDance, violating the statutory ban on algorithmic cooperation. While ByteDance retains ownership and licensing of the algorithm, TikTok U.S. will only “retrain, test, and update” it using U.S. user data.

The U.S. entity’s budget, legal compliance and commercial activity will also be overseen by ByteDance CEO Shou Chew, who will sit on the board of directors for TikTok U.S., creating another operational relationship that the lawsuit alleges is prohibited.

The petition further alleges that Trump violated PAFACA, which allows the president to grant only a one-time extension of no more than 90 days, and only with the necessary certifications to Congress. Trump reportedly approved five separate extensions — lasting 75, 75, 90, 90, and 120 days — far exceeding the statutory limit.

The petition alleges that Trump unlawfully directed Bondi not to investigate or enforce any violations of PAFACA, in direct violation of the act.

Shou Zi Chew (C), the CEO of TikTok, arrives to attend Donald Trump’s inauguration as the next U.S. president in the rotunda of the U.S. Capitol in Washington, D.C., on Jan. 20, 2025. (Shawn Thew/POOL/AFP via Getty Images)

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The lawsuit claims that Trump’s actions financially harmed investors in TikTok’s competitors. The plaintiffs noted that when the deal was made in January, Alphabet’s stock immediately dropped from $330.84 to $328.43.

Similarly, Meta stock fell from $760.66 to $748.91 during the initial framework announcement in September 2025, as it became apparent that the law might not be enforced.

According to the lawsuit, which is led by New York, California, Oregon and Arizona, the Trump administration’s imposition of tariffs also violates the US Constitution because Congress, not the president, has the power to impose sweeping tariffs, which are taxes on imports.