Alphabet has soared more than 80% in the past year, making it the world's third most valuable public company behind Nvidia and Apple. Despite worries about AI spending, the company's core businesses look strong.

A year ago, Alphabet faced antitrust scrutiny and fears that OpenAI's ChatGPT could erode its 90% search market share. Those threats have largely faded: antitrust troubles are mostly behind it, and the search challenge proved overstated. Google has protected its search franchise—which supplies over half its revenue—and moved from AI laggard to vying for leadership.

Quarterly earnings showed a 24% revenue rise and surging cloud-computing sales. However, markets fretted after Alphabet raised capital-spending guidance by $15 billion to around $200 billion for this year, with even more planned for 2025. Analysts expect $257 billion in capital spending by 2027, surpassing Amazon, Meta, and Microsoft.