Long-term investing is a lot easier than timing the stock market. You just have to pick growth stocks with good fundamentals and wait patiently for the catalysts to play out. Not every investor beats the market this way, but you can get started with megacap stocks that have withstood various economic cycles for decades.
Alphabet (GOOG 1.05%) (GOOGL 1.07%) is a beginner-friendly stock that regularly attracts capital from the pros. Google and YouTube ads are the main revenue drivers, but the company also has exciting opportunities in cloud computing and artificial intelligence. Alphabet has already become a leading cloud provider, and its AI investments are giving it a leg up over most of the competition.
These are some of the reasons long-term investors have been pouring capital into this stock.
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Cloud revenue growth should continue to accelerate
Google Cloud is a major part of Alphabet's long-term growth. While online advertising is still the company's largest business segment, Alphabet's cloud segment grew by 34% year over year in the third quarter of 2025.
NASDAQ: GOOG
Key Data Points
The cloud platform should continue to experience accelerated revenue growth due to AI infrastructure. Companies need to invest in more cloud storage to train their AI models and stay ahead of competitors. Although Alphabet has several AI components of its own, Google Cloud also serves as the digital backbone for many AI apps.
This part of Google's business also generates annual recurring revenue. Once businesses use Google Cloud, they get comfortable and usually stick around. It's a pain to migrate to another cloud platform, which incentivizes existing customers to stick with Google Cloud.
Google Cloud made up roughly 15% of Alphabet's Q3 2025 revenue. As this segment grows and makes up a larger percentage of total revenue, Alphabet's overall sales growth should increase. That can translate into more stock gains, and it's a scenario that long-term investors are anticipating as they allocate more capital toward the stock.
AI is enhancing existing products while enabling new business segments
Google Cloud is benefiting from the AI boom as more companies turn to cloud platforms for their AI needs. However, Alphabet as a whole is also incorporating AI into its businesses. Google and YouTube use AI to display targeted ads, and incorporating Gemini into Google searches has resulted in a more engaging user experience.
Alphabet is also making big strides into physical AI with Waymo. Its self-driving vehicles already cover the roads of several U.S. cities, such as Phoenix, San Francisco, and Austin. Alphabet has also planned expansions into other U.S. cities as it further tests the concept.
Eventually, self-driving cars can become commonplace and turn into a revenue generator. Google Cloud used to be a small part of Alphabet before it became a critical piece of its long-term growth narrative. Waymo and other AI investments might follow the same trajectory.
Alphabet is one of the few AI stocks that offer a robust business combined with some speculative long-term opportunities. It has a lot to like if you are a long-term investor.
