Motley Fool Backs Alphabet and Microsoft for 10-Year AI Bet as Cloud Growth Tops 63%
Updated
Updated · The Motley Fool · Jun 24
Motley Fool Backs Alphabet and Microsoft for 10-Year AI Bet as Cloud Growth Tops 63%
3 articles · Updated · The Motley Fool · Jun 24
Summary
Alphabet and Microsoft were singled out as decade-long AI holdings, with the case centered on cloud platforms that could capture years of recurring AI workload spending.
Google Cloud underpins the bullish view on Alphabet: first-quarter revenue jumped 63% year over year, operating margin widened to 33% from 18%, and Gemini plus custom TPUs are helping win AI workloads.
Alphabet is also preparing to sell TPUs to external customers, adding a new revenue stream beyond cloud subscriptions tied to AI application deployment.
Microsoft’s Azure grew 40% in its latest quarter, while its model-agnostic approach and 27% OpenAI stake position it to benefit whether customers choose ChatGPT or rival large language models.
Microsoft’s broader AI unit is already generating $37 billion in annual revenue, up 123%, reinforcing the view that both companies can ride cloud and AI demand over the next decade.
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