GOOG: Google Cloud will Reach AWS’ Current Run Rate in 4 Years

OguzO Capitalist
06-12

We can no longer say AI hasn’t made a dent in $Alphabet(GOOG)$ search dominance.

It made a dent. ChatGPT now has 6.2% of market share in search, while Google’s share declined from 98% to 92% in a year.

In the next decade, monetization of search as we know it today will be largely irrelevant.

The question is, whether GOOG will be able to make up for the lost revenue from Cloud and AI applications.

We can assume that Google Cloud will reach AWS’ current run rate in 4 years.

This will value it around $1 trillion and another $1 trillion market cap will come from Youtube and Google services.

If search generates half of the revenue it’s generating today five years later and AI generates quarter of the current search revenue, we will have another $270 billion revenue and another $1 trillion market cap at 4x sales.

$3 trillion valuation in 2030 looks reasonable, promising 7% annual return.

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