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Investing.com - Meta Platforms (NASDAQ:META) is gaining ground in the digital advertising market, capturing approximately $0.45 of every incremental digital ad dollar in Q2 2025, according to Bernstein analysis. This growth comes as incumbent Alphabet (NASDAQ:GOOGL), currently valued at $2.53 trillion, maintains its dominant position with robust revenue growth of 13% over the last twelve months.
Meta’s revenue grew 22% year-over-year in Q2, with strong performance driven by both increased user engagement and improved ad effectiveness. The company provided Q3 revenue guidance of $47.5-50.5 billion, representing 17-24% year-over-year growth, which exceeded market expectations. InvestingPro analysis shows Alphabet maintaining strong financial health with a "GREAT" overall score, suggesting resilient market positioning. Discover detailed competitive analysis and 15+ additional ProTips with an InvestingPro subscription.
Bernstein analyst Mark Shmulik noted that Meta, Reddit (NYSE:RDDT), and AppLovin (NYSE:APP) delivered healthy revenue beats with upbeat guidance for the second half of 2025, while Google parent Alphabet (NASDAQ:GOOGL) and Pinterest (NYSE:PINS) remain "battleground stocks" despite decent aggregate performance. Notably, Alphabet trades at a P/E ratio of 22.07, with 30 analysts recently revising their earnings estimates upward according to InvestingPro data.
Regional performance showed significant variation, with Meta, Pinterest, and Reddit all reporting strong results in Europe, while simultaneously noting a pullback from Asia-Pacific-based advertisers in the U.S. market related to tariff and de minimis changes.
Based on updated consensus estimates, Bernstein projects that Meta is on pace to catch Google Search in advertising revenues by the end of 2026, as Meta continues to gain market share from its current position of approximately 37% of the digital advertising market.
In other recent news, Google has reached an agreement with the United States government to provide artificial intelligence and cloud services to federal agencies. This deal, named "Gemini for government," is intended to enhance AI adoption across government operations, with agencies paying a nominal fee to access Google’s AI tools. Additionally, Google has introduced its new Pixel 10 smartphone series, which features advanced on-device AI capabilities powered by the Google Tensor G5 chip. The lineup includes various models, all equipped with Gemini AI to help users perform everyday tasks more efficiently.
In analyst updates, JMP Securities maintained a Market Outperform rating on Alphabet, keeping a price target of $225 due to improvements in the company’s AI Mode feature. Stifel also reiterated its Buy rating for Alphabet with a $222 price target after Google’s annual Made by Google event, where future AI integration plans were discussed. Meanwhile, Bernstein has maintained a Market Perform rating on Alphabet, setting a price target of $185. These developments reflect Alphabet’s ongoing focus on AI advancements and strategic partnerships.
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