Key Takeaways
- GOOGL shares advanced 2.8% during morning trading to reach $356.47, just two days ahead of the company’s Q2 2026 earnings release
- BMO Capital lifted its price target to $455 while maintaining its Outperform recommendation
- KeyBanc established a $445 target, forecasting Google Cloud and Search revenue expansion exceeding 20% annually through 2028
- Reports indicate Google is building a next-generation server chip dubbed “Frozen v2,” which could deliver 6-10x efficiency gains over existing TPUs
- Google Cloud’s Q1 2026 backlog reached approximately $462 billion, marking a near-doubling from the previous quarter
Shares of Alphabet experienced a 2.8% surge during Monday morning trading, reaching $356.47, as market participants positioned themselves ahead of the tech giant’s Q2 2026 earnings announcement scheduled for Wednesday, July 22, after market close.
The upward momentum coincided with a series of bullish analyst revisions supporting the stock. On July 17, BMO Capital increased its price objective to $455 from a previous $435, maintaining its Outperform stance despite recent news regarding delays in the Gemini 3.5 Pro model rollout.
KeyBanc established a $445 price objective, with analyst Justin Patterson contending that market participants are overlooking the sustained strength of both Google Cloud and Search businesses, anticipating annual revenue expansion above 20% extending through 2028.
Bank of America maintained its $430 price objective while slightly elevating its Q2 earnings-per-share projection ahead of the upcoming results.
Next-Generation “Frozen v2” Chip Development
Further energizing Monday’s advance, The Information disclosed that Google is developing an advanced server chip designated “Frozen v2.” Sources with knowledge of the project indicated the chip could deliver efficiency improvements ranging from six to ten times greater than Google’s existing tensor processing units.
This efficiency measurement relates to token processing capability per power unit consumed—a critical performance indicator for AI applications where energy expenditure represents a significant operational consideration.
Personnel involved with the project indicated the chip could be embedded directly within the Gemini AI architecture itself, rather than functioning as standalone hardware. Commercial deployment of these chips is anticipated as early as 2028.
A Google representative confirmed to Seeking Alpha that the organization continuously engages in “researching and experimenting with new innovations.” The representative emphasized the company’s “full stack approach” involving integrated co-design of hardware and software components.
Earlier in April, Google had already introduced its eighth-generation TPUs—the TPU 8t designed for training workloads and the TPU 8i optimized for inference tasks—during a cloud industry conference held in Las Vegas.
Massive Cloud Backlog Strengthens Investor Sentiment
Beyond the chip development news, Google Cloud’s Q1 2026 backlog totaling approximately $462 billion has sustained positive institutional sentiment. This figure represents a near-doubling within a single quarter, maintaining buyer interest despite broader concerns regarding AI infrastructure spending that have pressured semiconductor stocks.
The broader equity market provided a generally supportive environment on Monday. The Nasdaq composite advanced 0.5% while the S&P 500 gained 0.3%, partially recovering from the previous week’s steep semiconductor-driven decline that pushed the Philadelphia Semiconductor Index down over 20% from its recent high.
The Dow Jones Industrial Average declined 0.3%, reflecting sector rotation away from cyclical stocks toward mega-cap technology names.
GOOGL outperformed technology sector counterparts during the session, recovering losses sustained during last week’s broad-based tech sector retreat.
Analyst consensus ahead of Wednesday’s earnings report anticipates robust results across Search, YouTube, and Google Cloud segments.
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