From Nasdaq: 2025-05-20 09:04:00

Zacks.com Analyst Blog highlights Alphabet and Adobe as AI-driven tech stocks. Global spending on AI-supporting technologies to surpass $749 billion by 2028. Both stocks facing challenges from macroeconomic conditions and volatility. Alphabet integrating AI into search and cloud services, while Adobe expanding AI portfolio with GenStudio and Firefly Services.

Alphabet’s AI initiatives include Circle to Search, visual searches with lens, and AI Overview. Google Cloud preferred by enterprises for deploying AI agents. Regulatory headwinds like lawsuit with DOJ over Google Search pose challenges. Adobe launching Firefly Video Model-powered Generative Extend and upgrading After Effects and Frame.io V4.

GOOGL’s 2025 earnings estimate revised up to $9.43 per share, while ADBE’s estimate declined to $20.36 per share. Both stocks beat earnings estimates consistently. Alphabet is undervalued compared to Adobe based on Price/Sales ratio. Alphabet holds a Zacks Rank #3 (Hold) while Adobe has a Zacks Rank #4 (Sell).

Despite regulatory challenges, Alphabet shows strong growth in cloud and search. Adobe faces stiff competition in AI space. Alphabet has a dominant position in the search engine market. Alphabet has surpassed 270 million paid subscriptions with YouTube and Google One as key drivers. Zacks experts recommend Alphabet over Adobe based on current scenario.



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