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Cathie Wood’s 11 Biggest AI and Data Center Stock Picks. Alphabet Inc. (NASDAQ:GOOGL) ranks #10 (see Cathie Wood’s 5 Biggest AI and Data Center Stock Picks).
Cathie Wood’s Stake: $171,300,778
What was once seen as a stock that could be disrupted by AI (threats to search) is now soaring because Alphabet Inc. (NASDAQ:GOOGL) successfully turned the tables and embraced AI instead of resisting it. In Q1, sales rose 22%, while Cloud revenue jumped 63% year over year, driven by surging AI and core cloud demand, while operating profit in the segment tripled to $6.6 billion.
But what about AI threats to Google search? Alphabet Inc. (NASDAQ:GOOGL) still has over 90% of the total market share in search. Gemini has reached 750 million monthly active users (MAU), compared with 450 million seen at the start of 2025. Analysts believe the company can monetize its Gemini user base with ads. Alphabet shows ads in about 25% of these AI results to capture users with strong intent for shopping.
Alphabet Inc. (NASDAQ:GOOGL) is also making strides in the AI hardware space with its Tensor Processing Units (TPUs). A long-term deal with Broadcom secures this chip supply through 2031, helping Google lower costs while building a massive AI infrastructure. Anthropic plans to use 3.5 gigawatts of Google’s TPU power starting in 2027.
L1 Capital International Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q1 2026 investor letter:
“Portfolio adjustments during the March 2026 quarter were relatively modest, but deliberate. We trimmed investments in AerCap, Alphabet Inc. (NASDAQ:GOOGL), HCA Healthcare and Weir Group at prices around the top end of our assessed fair value range, with all of these businesses benefitting from positive sentiment intra-quarter. Alphabet’s share price has more than doubled over the past 12 months. This reflects….(Click Here to Read the Letter in Detail)
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While we acknowledge the potential of GOOGL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: 33 Stocks That Should Double in 3 Years and Cathie Wood 2026 Portfolio: 10 Best Stocks to Buy.
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