Alphabet Inc. is the parent company of Google. After its formation ten years ago, it quickly became a frontrunner for innovation and technology. As the tech giant navigates its future, Waymo, its self-driving car division, stands out as one of its most successful ventures outside of Google itself. Waymo is valued at an eye-popping $150 billion by Raymond James, and analysts are predicting massive growth for the company.
Founded in 2015, Alphabet created “Other Bets” to house these risky endeavors—colloquially called “moonshots”—of the tech giant. These initiatives have been hugely important to Alphabet’s corporate identity as they look to disrupt established, cash-generating technologies and business models. In its 2014 annual report, the company emphasized the importance of innovation, stating, “We won’t become complacent, relying solely on small tweaks as the years wear on.”
Regardless of whether their bets pay off or fail, Waymo’s influence on the transportation industry is going to be profound. And according to the company’s own projections, they’ll reach 1.4 million rides per week by 2027. By 2030, that figure will continue to increase rapidly, reaching 5.8 million rides per week! This projected increase makes Waymo’s current efforts to transform city transportation and improve mobility for millions even more promising.
At the same time, Alphabet’s cloud business has been one of its most important growth drivers. As the third-largest provider overall in the cloud infrastructure market, Google Cloud stands behind only Amazon Web Services and Microsoft Azure. This position has been seminal in leading the company’s bottom line financial performance. During the second quarter of 2025, Alphabet’s cloud division celebrated an equally momentous operating profit of $2.8 billion, powered by $13.6 billion in revenue. That is indeed a notable achievement, particularly as the division just turned a profit in 2023.
Further, Alphabet’s cloud services now have $106 billion in backlog, a great metric of a high degree of future committed revenue. This record-breaking number is a testament to the enormous market demand for cloud solutions. Additionally, it highlights the firm’s increasing ability to pull healthy gross margins out of its offerings.
Though Waymo and Google Cloud show strong profit growth firepower, Alphabet still contends with constant chatter about its convoluted corporate structure. Other analysts are calling for an outright divestiture of the company. Ultimately, they are convinced this would allow more investors to control the companies they really desire to hold. D.A. Davidson analysts articulated this sentiment, stating, “We believe the only way forward for Alphabet is a complete breakup that would allow investors to own the business they actually want.”
Despite these challenges, Alphabet’s market capitalization has soared over 150% to approximately $2.5 trillion during Sundar Pichai’s tenure as CEO. This increase signals both the market’s optimism about the company’s innovation path and their strong financial results.
YouTube has also stood the test of time as another part of Alphabet’s defensive portfolio, with Raymond James valuing it at $306 billion. Its platform has proven to be a powerful recurring revenue source, continuing to diversify Alphabet’s deeply digital business model even further away from digital advertising.
In light of regulatory scrutiny and potential government intervention in the tech sector, Alphabet’s leadership has expressed concerns about overreach. Kent Walker, Google’s Legal Chief, commented on these challenges, stating that such an approach “would result in unprecedented government overreach.” As the company continues to navigate this complex landscape, it is clear that it is still committed to continuing to foster innovation while addressing regulatory concerns.
The future looks bright for Waymo and Google Cloud alike, as they are playing key roles in Alphabet’s master plan to make each of them. This diversified portfolio uniquely positions the company to continue adapting to evolving consumer preferences and market dynamics and unlocking new growth opportunities.