Trump unsettles the stock market. Alphabet stock may test the 188 USD resistance level

Alphabet’s stock is undergoing a correction towards the trendline at 135 USD, but it may first test the 188 USD resistance level.

Uncertainty surrounding Donald Trump’s tariff policy has significantly increased volatility in Alphabet Inc. (NASDAQ: GOOG) stock. The company is set to release its Q1 2025 report at the end of April, which will guide investors in deciding whether to invest in the stock. Meanwhile, the shares remain in a corrective phase.

This article examines Alphabet Inc., outlines its key revenue streams, and reviews its 2024 performance. Additionally, it offers a technical analysis of GOOG stock, serving as the basis for the Alphabet stock forecast for 2025.

About Alphabet Inc.

Alphabet Inc. was established on 2 October 2015 through a restructuring of Google, which had been founded by Lawrence Page and Sergey Brin in 1998. Google was originally a search engine but gradually evolved into a diversified technology company, covering advertising, cloud services, mobile platforms, and other areas.

By 2015, Google’s scope and diversification had made its management increasingly complex. As a result, a holding structure – Alphabet, Inc. – was set up, with Google becoming one of its divisions focusing on core businesses (Search, YouTube, and Android). At the same time, innovative projects, such as Waymo and Verily, were spun off into separate companies under Alphabet’s management.

Since the restructuring, Alphabet has replaced Google as the listed public company on the stock exchange, retaining its existing tickers (GOOGL and GOOG). Larry Page became Alphabet’s CEO, Sergey Brin its President, and Pichai Sundararajan was appointed CEO of Google.

Alphabet is listed on the stock exchange under two tickers, GOOGL and GOOG:

• GOOGL (Class A) – voting shares. Holders of these shares are entitled to vote at shareholder meetings (1 share = 1 vote)
• GOOG (Class C) – non-voting shares. These shares provide the same economic rights (dividends, capital appreciation) but do not allow holders to participate in the company’s management.

Alphabet Inc.’s main revenue streams

Alphabet Inc., the parent company of Google and other subsidiaries, generates revenue from several business segments. The primary sources of revenue are outlined below:

• Google services: the largest source of income, driven primarily by advertising. This includes:
  • Google Search and others: revenue from advertisements placed on Google Search, Gmail, Google Maps, and other Google-owned services
  • YouTube ads: revenue from banner ads, skippable and non-skippable video ads, and overlay ads on YouTube
  • Subscriptions, platforms, and devices: revenue from subscription services such as YouTube Premium, YouTube TV, Google One, and NFL Sunday Ticket. This category also includes app sales, in-game purchases via the Google Play Store, and sales of hardware such as Pixel phones, Nest and Chromecast devices

• Google Cloud: revenue from cloud computing services, including infrastructure, platform solutions, and apps such as Google Workspace and Gemini for Cloud. Google Cloud serves corporate clients and is growing rapidly, although it still lags behind competitors such as AWS and Microsoft Azure

• Other Bets: includes Alphabet’s ambitious ventures, such as Waymo (autonomous driving), Verily (healthcare), and GFiber (internet services), with most revenue coming from the latter two. Although this segment generates less revenue, it focuses on long-term innovation but often operates at a loss
• Alphabet operations: this includes small currency-related hedging revenue and other corporate activities. This is not the primary segment but includes other income unrelated to the core segments

Advertising remains the basis for Alphabet’s revenue, with Google services, particularly Search and YouTube, taking the lead. Google Cloud is a growing revenue stream, reflecting Alphabet’s commitment to developing solutions for companies, while other projects are speculative investments with a limited but increasing impact on revenues.

Alphabet Inc.’s financial position

Alphabet Inc. is in a strong financial position, reflecting both stability and strategic momentum. The company continues to deliver steady revenue growth, driven primarily by its advertising operations, particularly via Google Search and YouTube.

Alphabet closed 2024 with a revenue of 350 billion USD, a 14% increase year-on-year. Net income rose by 28% to 100 billion USD.

Google Services, which includes Search, YouTube, and other platforms, generated 84.1 billion USD in revenue in 2024, up 10% from 2023. The Google Cloud segment also expanded, reaching 12 billion USD, also a 10% increase from the previous year.

Alphabet plans to invest around 75 billion USD in 2025, significantly higher than the 52 billion USD invested in 2024. The primary objective is to expand its AI infrastructure and capabilities. CEO Sundar Pichai emphasised the importance of AI across all the company’s products.

Trump’s trade policies and their impact on Alphabet

Donald Trump’s tariffs have created new challenges for tech companies, including Alphabet. While Alphabet’s operations are primarily digital and not directly dependent on imports of physical goods, the broader economic consequences of these trade policies may still affect the company.

Tariffs may slow global economic growth, potentially leading to reduced advertising spending by businesses – Alphabet’s primary source of revenue. Companies typically cut marketing budgets during times of economic uncertainty, which could adversely affect Google’s ad revenues.

In addition, tariffs on imported technology components may raise costs for Alphabet’s substantial investments in AI and cloud infrastructure projects. New duties on semiconductors and other equipment could drive up the cost of expanding data centres and AI development, which, in turn, may affect profitability.

Furthermore, escalating trade tensions could provoke retaliatory measures from foreign governments, including the introduction of digital taxes targeting US tech companies. With more than half of Alphabet’s revenue coming from international markets, such measures could negatively affect its global revenues and profitability.

While Alphabet’s digital business model protects it from the direct impact of tariffs, the company may still face broader economic and industry-related consequences stemming from trade policy shifts.

Expert forecasts for Alphabet Inc. stock

• Barchart: 41 out of 53 analysts rated Alphabet stock as a Strong Buy, three as a Moderate Buy, and nine as a Hold. The high price target is 240 USD, while the low one is 167 USD
• MarketBeat: 18 out of 25 specialists assigned a Buy rating to the shares, while six gave a Hold recommendation, and one advised it as a Sell. The high price target is 240 USD, while the low one is 165 USD
• TipRanks: 11 out of 13 respondents gave a Buy rating to the stock, and 2 recommended it as a Hold. The high price target is 234 USD, while the low one is 190 USD
• Stock Analysis: 18 out of 42 experts rated the shares as a Strong Buy, 15 as a Buy, and nine as a Hold. The high price target is 240 USD, while the low one is 167 USD

Alphabet Inc. stock price forecast for 2025

Alphabet stock is trading in an ascending channel on the weekly timeframe. In February 2025, the price rebounded from the channel’s upper boundary and headed down, indicating a correction, which may end when the price reaches the trendline. A move to the trendline implies a breakout below the 150 USD support level. The first attempt to breach it failed. Based on Alphabet Inc.’s stock performance, possible price movements in 2025 are as follows:

The primary forecast for Alphabet stock anticipates growth to the 188 USD resistance level, followed by a rebound and a decline to the 135 USD trendline.

The alternative forecast for Alphabet stock suggests that the price could retest the 150 USD support level before breaching it and falling to the 125 USD trendline. A rebound from the trendline will signal the completion of the correction and another wave of growth in Alphabet’s stock price.

Summary

Alphabet Inc. is set to release its Q1 2025 earnings report in late April. Analysts expect earnings to range from 1.95 to 2.30 USD per share, representing year-on-year growth of between 0.1% and 21.6%. These varied estimates reflect different levels of investor confidence in Alphabet’s financial prospects. Trump’s tariff policy introduces additional uncertainty as it may influence consumer behaviour and advertising budgets – Alphabet’s primary revenue streams.

In its Q4 2024 earnings commentary, Alphabet warned that Q1 revenue could come under pressure from a stronger US dollar compared to the previous quarter (although the dollar index actually fell by 23% in Q1 2025). The company also cited the absence of an extra day in February, present in the leap year 2024, as a factor that would create a one-day shortfall relative to the previous year. Advertising revenue was expected to grow at a moderate pace, owing to the high base in 2024, while the outlook for Google Cloud remains uncertain, as it depends on the timing of new capacity launches.