Bank Ratings | JPMorgan: The Importance of Google Cloud Services Activity This Year Will Surpass Previous Years, Reiterates “Overweight” Rating for Alphabet

Golden Ten Data, April 21 — JPMorgan released a report indicating that the upcoming Google Cloud Next 2026 event, scheduled for April 22–24, carries more weight than in previous years. This is due to the growing significance of Google Cloud as the company’s second largest business line and its fastest-growing segment. Revenue’s annual growth rate accelerated from 48% in last year’s fourth quarter to an estimated 61% in this year’s first quarter, while backlogged orders grew approximately 160% year-on-year to 240 billion dollars in last year’s fourth quarter. Regarding profitability, Google Cloud’s operating profit margin expanded by 960 basis points to 23.7% year-on-year last year, and it is forecasted to further expand to 27.9% this year. JPMorgan expects that this year's event will highlight the growth momentum Google Cloud has continuously accumulated over the past three years. The main pre-event questions focus on whether investment in AI infrastructure and models can be transformed into sustainable enterprise adoption, repeatable investment returns, and unit economics with resilient profitability. The event is believed to underscore the importance of Google’s substantial capital expenditures. The bank reiterates its “Overweight” rating on Alphabet and maintains a target price of 395 dollars.