On Wednesday, BofA Securities maintained a Buy rating on Alphabet Inc. (NASDAQ:GOOGL) with a price target of $173.00. The firm observed a year-over-year decline in Google's global search market share, which fell to 91.5%, a drop of 143 basis points. Conversely, competitors like Bing saw a year-over-year increase of 39 basis points, reaching a 3.4% market share. The "Others" category, which includes search engines such as Yandex (NASDAQ:YNDX), Baidu (NASDAQ:BIDU), Naver, and DuckDuckGo, but not ChatGPT, rose by 115 basis points year-over-year to 4.0%.
Mobile search market dynamics showed Google's share down by 114 basis points year-over-year to 95.3%, while Bing's share inched up by 4 basis points and the "Others" category increased by 124 basis points. Desktop search trends indicated a more significant shift, with Google's market share decreasing by 274 basis points year-over-year to 82.0%. Bing and the "Others" category benefitted from this shift, with Bing's share growing by 165 basis points and "Others" by 101 basis points. Yandex was the top gainer in the "Others" category, with a 93 basis point increase, largely due to its rising popularity in Russia.
The analyst also highlighted the traffic trends among major search platforms, including ChatGPT. While Google's web visits grew 6% month-over-month to 2.8 billion, Bard's visits also increased by 6% to 10.7 million, and Bing's visits rose by 2% to 43.8 million. ChatGPT showed a significant 26% month-over-month increase in visits, totaling 52.9 million, which accounted for approximately 2.0% of Google's web visits.
App download data from Sensor Tower revealed that Google's app downloads increased by 2% month-over-month globally to 13 million. In comparison, Bing's app downloads surged by 65% to 11 million, and ChatGPT app downloads decreased by 6% to 21 million. The download ratio between Google and Bing was 1.2x globally and 4.9x in the US. When compared to ChatGPT, Google had fewer downloads, with a ratio of 0.5x globally and 0.8x in the US.
InvestingPro Insights
As Alphabet Inc. (NASDAQ:GOOGL) navigates the competitive landscape of search engines and interactive media services, it's crucial to consider the company's financial health and market valuation. According to InvestingPro data, Alphabet boasts a substantial market capitalization of $1790.0 billion, reflecting its significant presence in the industry. The company's Price to Earnings (P/E) ratio stands at 24.84, with an adjusted P/E for the last twelve months as of Q4 2023 at 23.11, which suggests that the stock is trading at a reasonable valuation relative to near-term earnings growth.
InvestingPro Tips highlight that Alphabet holds more cash than debt on its balance sheet, providing financial stability and the ability to invest in growth opportunities or weather economic downturns. Additionally, the company's liquid assets exceed its short-term obligations, ensuring it can meet immediate financial needs.
Despite the shifts in market share indicated in the article, Alphabet remains a prominent player in its industry, as evidenced by its strong market capitalization and healthy financial ratios. The company's revenue for the last twelve months as of Q4 2023 was a robust $307.39 billion, with a revenue growth of 8.68%. This growth, coupled with a gross profit margin of 56.94%, underscores Alphabet's ability to generate income efficiently.
For readers interested in deeper analysis and more InvestingPro Tips, such as the company's trading patterns and analysts' predictions, visit https://www.investing.com/pro/GOOGL. There are an additional 12 InvestingPro Tips available, including insights on Alphabet's performance over the last decade and its profitability over the last twelve months. To get an additional 10% off a 2-year InvestingPro+ subscription, use coupon code SFY24, or use SFY241 for a 10% discount on a 1-year subscription.
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