Analysts highlighted Alphabet Inc.'s strong execution and growing AI momentum, with one expert calling it a clear standout and outlining broader implications for tech and semiconductor stocks.

Sarat Sethi: Alphabet Firing Across Multiple Growth Engines

DCLA Managing Partner Sarat Sethi told CNBC on Wednesday that Alphabet is delivering strong performance across several business lines, reinforcing its role as a core long-term holding. He said the company is firing on all cylinders, with multiple growth drivers working in tandem rather than relying on a single segment.

Sethi pointed to graphics processing units (GPUs) and YouTube as key pillars supporting growth and emphasized that Alphabet generates significant cash flow. He added that the company's elevated capital spending remains justified as long as it continues to deliver solid returns on invested capital, supported by diversified growth levers.

Gil Luria: Alphabet Outperforms On Cloud And AI Execution

D.A. Davidson's Gil Luria told CNBC on Thursday that Alphabet outperformed peers, noting that Google delivered stronger results than competitors and may have made others look weaker by comparison. He highlighted a sharp acceleration in Google Cloud growth, which outpaced gains seen at Amazon.com Inc.'s Amazon Web Services and Microsoft Corp.'s Azure.

Luria attributed this strength in part to rising enterprise adoption of Gemini, as companies increasingly use multiple AI providers rather than relying on a single platform. He also pointed to Alphabet's move to sell tensor processing units (TPUs) as a meaningful contributor to backlog growth, adding to its AI monetization strategy. While he acknowledged that peers also posted solid results, he said Alphabet clearly stood out.

Broader Market And Chip Implications

Luria said Alphabet's performance reflects strong underlying demand across the AI ecosystem, including data center expansion, digital advertising growth, and resilient consumer activity benefiting companies like Amazon. He added that the overall market takeaway remains positive despite near-term stock reactions.

He noted that concerns around companies like NVIDIA Corp. stem partly from perceptions of rising competition as firms develop their own chips. However, he does not see that as a fundamental negative. He said the outlook for Advanced Micro Devices, Inc. and Micron Technology, Inc. appears more straightforwardly positive, as rising data center costs—driven in part by higher memory input costs—support demand for their products.

Luria also emphasized that investors are increasingly focused on return on investment from AI spending. He estimated that AI-related economic activity across companies like Microsoft, Amazon, and Alphabet, as well as firms such as OpenAI and Anthropic, has already reached a run rate exceeding $100 billion, up from near zero two years ago. He said this indicates that data center spending is translating into real economic output, supporting continued growth even as markets remain cautious about the scale of investment.

GOOGL Price Action: Alphabet shares were up 9.93% at $384.70 at the time of publication on Thursday. The stock is trading at a new 52-week high.