All of the "Magnificent Seven" stocks have delivered market-beating returns over the past decade (that's part of why they're called that). This group includes leading tech companies: Alphabet (GOOG -0.20%) (GOOGL -0.21%), Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla.

Of these seven businesses, Nvidia has been the best-performing in the past 10 years, while Alphabet has been the worst. However, that alone says little about Alphabet's prospects. Trailing six stocks as phenomenal as its Magnificent Seven peers is nothing to be ashamed of.

To determine whether Alphabet's shares are worth buying today, let's look into the tech giant's business and growth prospects.

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The core business is still strong

Alphabet is the parent company of Google, the leading search engine in the world. The company derives the lion's share of its money from its Google advertising reporting segment, which includes ads displayed on YouTube. The company's Google services unit also includes subscription and device sales.

In the fourth quarter, Google advertising revenue came in at $65.5 billion, an increase of about 11% year over year.

Google services' revenue of $76.3 billion was 12.5% higher than the year-ago period. Alphabet's total top line of $86.3 billion increased 13.5% year over year.

The ad market suffered a steep decline for much of 2022 and 2023, leading to subpar financial results for the tech giant. That's par for the course: Economic conditions sometimes lead companies to decrease spending on various things, including advertising.

However, things improved in the second half of last year, and Alphabet was able to bounce back. The company's prospects in this field still look excellent for at least two reasons.

First, Alphabet benefits from the network effect. The more people use its search engine, the more data it collects to fine-tune and improve search results, thereby attracting even more search queries. YouTube also benefits from a similar dynamic, with content creators and viewers increasingly seeking one another on the platform.

Second, Alphabet is creating a recurring source of revenue by ramping up YouTube and other subscription options. Management talked about "significant growth" in subscription revenue. It still accounts for a small percentage of Alphabet's total sales -- just $15 billion in 2023, 5 times more than in 2019. Still, there is significant room for growth in the streaming market. YouTube subscriptions are just one way in which Alphabet is diversifying its revenue stream.

Two key growth avenues

One significant growth opportunity for Alphabet is artificial intelligence (AI). Though it has used AI-powered features to improve its search engine for a while, the tech company has been looking to ramp up initiatives, especially since the launch of ChatGPT. Alphabet's generative AI application called Bard was a disappointment. The company more recently launched Gemini (essentially a renamed Bard), which also ran into some controversies over perceived bias in generating images, among other limitations.

Still, the point is, Alphabet is making serious strides in the generative AI space and could be one of the winners of this rapidly expanding industry. Then there is Alphabet's cloud computing unit, Google Cloud. This segment's revenue still accounts for a small percentage of Alphabet's total -- it generated $9.2 billion in sales in the fourth quarter, up 25.7% year over. But this division continues to grow more quickly than the rest of the business. The cloud computing industry is predicted to continue evolving rapidly.

Alphabet is one of the leaders in this niche, where it arguably benefits from switching costs -- another important tailwind for Alphabet.

Buy and forget

Despite underperforming compared to the rest of the Magnificent Seven in the past decade, Alphabet's business remains solid. It boasts a solid competitive edge from multiple revenue sources and various growth avenues and generates enough cash to continue investing in exciting trends.

Alphabet currently has $69.5 billion in free cash flow. Will the tech giant outperform some of its peers moving forward? That's hard to say. What seems clear is that Alphabet will continue to deliver market-beating returns.