Alphabet’s stock surged to a 52-week high of $404.47 this week, putting the company within 4.2% of a $5 trillion market cap, a milestone only Nvidia has reached. The rally was fueled by blowout Q1 earnings and a massive bet from Warren Buffett’s Berkshire Hathaway, which tripled its stake to nearly 58 million shares worth around $17 billion. Now, all eyes are on Google I/O, where the tech giant just announced its biggest Search revamp in 25 years, powered by the new Gemini 3.5 Flash.
Record Earnings and Institutional Conviction
Alphabet posted Q1 revenue of $109.9 billion, up 21.8% year over year, with EPS of $5.11 crushing the $2.68 consensus. Google Cloud showed particular strength, and capital expenditures nearly doubled to $36 billion as the company doubled down on AI infrastructure. The dividend was also raised to $0.22 per share. Meanwhile, Berkshire’s disclosure that it had grown its Alphabet position from 17.8 million shares to 58 million in a single quarter has drawn fresh attention to the portfolio’s direction under incoming CEO Greg Abel.
AI Transformation of Search
At Google I/O, the company unveiled a fully redesigned Search box that dynamically expands and accepts text, images, files, videos, and Chrome tabs, retaining context throughout a conversation. The real showstopper, however, was the introduction of “information agents”—persistent background agents that monitor the web 24/7 for personalized alerts, such as sneaker collaborations or apartment listings matching specific criteria. These will launch this summer for AI Pro & Ultra subscribers. AI Mode has already crossed 1 billion monthly users, with queries more than doubling every quarter since its debut a year ago.
Gemini’s Growing Footprint
Gemini now reaches 900 million monthly users, up from 400 million a year ago. A new personal agent called Spark can comb credit card statements for hidden fees or track school deadlines, with user-controlled permissions. Google also expanded Personal Intelligence in AI Mode to nearly 200 countries and 98 languages, free of charge. While the stock slipped 2.09% on the day of the developer conference, the broader narrative remains overwhelmingly bullish: 28 analysts rate the stock a Buy, with Oppenheimer raising its target to $445. The $5 trillion valuation is now a tangible near-term catalyst.
