Quick Read – Buffett and the author keep buying GOOGL as Search grew 19%, Cloud surged 63%, and the stock still trades at just P/E 26. – MSFT grows overall revenue at 18% versus Alphabet’s 63% cloud rate, and META has no cloud franchise, leaving GOOGL as the stronger AI value. -…
pEx surged 107% to $36 billion and crushed free cash flow, but Alphabet’s $460 billion cloud backlog validates the spend as the moat itself. – I keep hitting the buy button on Alphabet (NASDAQ:GOOGL) because the business behaves like a tollbooth on the entire internet, and every quarter the toll gets higher while the road gets wider. Warren Buffett appears to have arrived at the same conclusion
I got there first for my own account, and I am still adding. The pitch is simple. Google Search is a self reinforcing flywheel.
More queries feed better data, better data sharpens targeting, sharper targeting draws more advertising dollars, and those dollars fund the next turn of the wheel. Buffett views Alphabet’s moat through the search network flywheel and the capital scale that lets the company fund custom AI chips and global data centers straight out of cash flow. Smaller competitors cannot match that without crippling themselves.