Signal Ledger LabSignal Ledger valuation · GOOGL
Alphabet Inc.
What the shares are worth today on our research (management’s own targets for each business): every line valued at the end of FY2030, net debt rolled forward, then discounted back to Jun 30, 2026.
- Business value at FY2030
- $4,440B
- FY2030 revenue
- $1,014B
- FY2030 EPS · P/E
- $21.84 · 19×
- Discount rate (WACC · equity)
- 9.87% · 9.57%
Latest quarter in this research: Q2 2026
Reported Jul 22, 2026 for the quarter to Jun 30, 2026 (company release ↗). This valuation already reflects these results (researched Oct 23, 2026).
| Segment | Revenue | vs a year ago | Operating income | Margin |
|---|---|---|---|---|
| Google Services | $94.5B | +15% | $39.5B | 41.8% |
| Google Cloud | $24.8B | +82% | $8.81B | 35.6% |
| Other Bets | $0.38B | +2% | −$1.80B | -470.9% |
- Latest released quarter as of October 22; subsequent October 27–29 results are not yet reported. Product/category profits left null when not separately disclosed.
What each business is worth
| Business | Model | FY2030 revenue | Value today | Per share | 2030 multiple | Value from beyond FY2030 |
|---|---|---|---|---|---|---|
| Google ServicesGoogle Services · advertising and consumer products | Capacity (capex follows demand) | $624B | $2,825B | $231.02 | 11.8× EBITDA | 64% |
| Google CloudGoogle Cloud · enterprise infrastructure and software | Capacity (capex follows demand) | $390B | $1,071B | $87.56 | 9.3× EBITDA | 79% |
| Company costsHead-office costs no segment carries, valued as one negative business | Cost line | — | −$596B | −$48.76 | — | 64% |
| Other Bets · autonomy and emerging servicesWaymo announced a 126B post-money priced round. Retain the pre-existing 85% Alphabet ownership assumption (126 × 85% = 107.1B); 85% is not publicly verified or reported. This mark covers Waymo within Other Bets, not separately valued consolidated subsidiaries or a second future exit value. The segment operating losses are not separately stacked onto a funding-round equity mark. The code corporate line is Alphabet-level costs, not a separate valuation of all remaining Other Bets; non-Waymo scope, ownership and capital funding remain pending user judgment. | Market mark | — | $107B | $8.76 | — | — |
| Noncurrent restricted marketable equity securitiesNote 3 fair value of noncurrent restricted marketable equity securities 14.126B at June 30, outside cash/current securities of 242.474B. The filing does not identify this entire line as SpaceX; current marketable equity includes 87.063B in aggregate and is already bridged once. | Market mark | — | $14B | $1.16 | — | — |
| Private equity stakes remeasured to observable rounds in Q2 2026only the stakes with a recent priced round are counted; the other $36.4B carried at cost is left out | Market mark | — | $88B | $7.19 | — | — |
| Businesses and holdings | $1,014B | $3,509B | $286.91 |
Google Services: does new capacity pay?
Each $1 of equipment earns 95.5% EBITDA a year against a 22.0% break-even. Every $1 of new annual revenue is worth $1.45 today after paying for its equipment.
Google Cloud: does new capacity pay?
Each $1 of equipment earns 38.1% EBITDA a year against a 22.0% break-even. Every $1 of new annual revenue is worth $0.76 today after paying for its equipment.
Needs $70B of funding before it pays for itself; that lands in net debt.
From 2030 back to today
- Enterprise value at end of FY2030$4,440B
- Plus net cash at FY2030$626B
- Equity value at FY2030$5,066B
- ÷ (1 + 9.57%)^4.5 years at the cost of equity$3,358B
- + dividends paid on the way, discounted$38B
- + investments held outside the businesses$209B
This reconciliation checks the published Signal Ledger valuation against the net-debt path. The difference is 0.7%, inside our 5% tolerance.
From businesses to one share
- All businesses, valued today$3,300B
- − borrowings$100B
- − finance leases$2.6B
- − preferred and minority claims$19B
- + cash and short-term investments$242B
- + investments held outside the businesses$209B
- ÷ diluted shares12.230B
- Signal Ledger valuation$296.77
Year by year to FY2030
| Fiscal year | Revenue | EBITDA | Capex | Free cash flow | Net debt at year end |
|---|---|---|---|---|---|
| FY2026part already reported | $494B | $190B | $190B | −$30B | $84B cash |
| FY2027 | $602B | $237B | $104B | $99B | $175B cash |
| FY2028 | $726B | $293B | $149B | $101B | $272B cash |
| FY2029 | $865B | $356B | $168B | $137B | $407B cash |
| FY2030 | $1,014B | $427B | $149B | $216B | $626B cash |
What must be true
- Google Services · advertising and consumer products grows revenue from $395.0B in FY2026 to $623.9B in FY2030 (1.6×).
- Google Cloud · enterprise infrastructure and software grows revenue from $98.6B in FY2026 to $390.5B in FY2030 (4.0×).
- Google Services raises its EBITDA margin from 43.8% to 47.8%.
- Google Cloud raises its EBITDA margin from 41.7% to 45.7%.
- The company spends $759.8B of capital expenditure through FY2030.
- The company stays net cash throughout (lowest point $84.0B of net cash in FY2026).
- Google Services earns 95.5% EBITDA a year on each dollar of equipment, above the 22.0% it needs to cover depreciation and the cost of capital.
- Google Cloud earns 38.1% EBITDA a year on each dollar of equipment, above the 22.0% it needs to cover depreciation and the cost of capital.
What the price implies
To reach $324.22 at our discount rate, Alphabet Inc. would need about $1,133.6B of FY2030 sales (growth of about 23.1% a year from FY2026) with 47.0% EBITDA margin — versus $1,014.4B and 47.0% EBITDA margin in our research.
At the research price of $324.22 (2026-10-23), the price asks more than our assumptions overall. These are operating requirements at that price, not additional valuations or forecasts.
If sales and margins changed together
Each row matches the same research price at our unchanged discount rate, by scaling every operating line's margin by one common factor. Sales cover margin and capacity lines only; other valuation lines stay fixed. Margins are revenue-weighted within each metric, before separately modeled corporate costs and eliminations. The conclusion uses the row at our research margins when sales alone can match the price, otherwise the solved row needing the least sales growth; this is a trade-off between growth and profitability, not a forecast.
| FY2030 sales factor | FY2030 sales | FY2026–30 CAGR | Required FY2030 margin | Requirement |
|---|---|---|---|---|
| 1.12×At research margins | $1,133.6B | 23.1% | 47.0% EBITDA | Within margin guardrails |
| 1.50× | $1,521.6B | 32.5% | 40.9% EBITDA | Within margin guardrails |
| 2.00× | $2,028.8B | 42.4% | 36.4% EBITDA | Within margin guardrails |
| 3.00× | $3,043.3B | 57.6% | 31.7% EBITDA | Within margin guardrails |
CAGR uses $493.6B of same-scope FY2026 sales from the published model or its sourced research base, over four fiscal years. “Within margin guardrails” checks numeric limits only, not commercial plausibility. Each line and year must stay at or below 50.0% GAAP EBIT and 100% EBITDA, or our research margin where that is higher; capacity EBIT uses the engine's equipment depreciation. Unsolved margins are not extrapolated.
- Implied discount rate
- 9.3%
- All-business FY2030 sales factor
- 1.12×
The WACC that makes model value equal the price, shifting WACC and cost of equity by the same amount. Model: 9.9% WACC · 9.6% cost of equity.
FY2030 revenue would need to reach $1,133.6B (model: $1,014.4B) across the margin and capacity businesses. FY1 stays fixed; the sales change ramps to FY2030 and stays at that factor thereafter.
If only one business changed
Businesses with margin or capacity revenue paths, ordered by value today. Revenue and margin are separate alternatives; these requirements are not added together.
Google Services · advertising and consumer products
- Revenue alone
- FY2030 revenue would need to reach $715.2B (model: $623.9B).
- Margin alone
FY2030 EBITDA margin would need to reach 52.2% (model: 47.8%).
Google Cloud · enterprise infrastructure and software
- Revenue alone
- FY2030 revenue would need to reach $578.2B (model: $390.5B).
- Margin alone
FY2030 EBITDA margin would need to reach 52.5% (model: 45.7%).
Mechanical requirements, not forecasts. The separate sales-only and single-business factors are searched from 0.1× to 6×; an unsolved comparison means this business alone cannot get there within those bounds. Single-business revenue changes apply from FY2 onward; margin changes scale the full EBIT or EBITDA margin path. Mixed groups show revenue-weighted EBIT and EBITDA margins separately. Requirements above 100% are not feasible margins. Joint rows instead search non-negative uniform margin factors only up to the EBIT/EBITDA guardrails; the entire margin path scales, including post-FY2030 convergence. Sales and margins change together only in that table. The rate search runs from the largest terminal growth rate plus 0.5 percentage points to 30% WACC.
The discount rate
- Cost of equity
- 9.57%
- WACC
- 9.87%
- 10-year Treasury · model / spot
- 3.87% · 5.13%
r_f 3.87% (5-year average 10-year Treasury yield 3.87% (spot 5.13% on 2026-10-21)) + β 1.14 after Blume adjustment × 5%, rounded to 0.01% (1bp)
methodology §4.5: market-weighted WACC + 0.459522 point build-out premium: 1pp × clamp(FY1 net debt increase / (2% × equity market value), 0, 1), not rounded
The model uses the recorded 5-year average Treasury yield. The spot yield is shown for context.
Every input, with its source
Show 36 inputs · reported, guidance and rule-based
| Input | Value | Basis | Why |
|---|---|---|---|
| Revenue FY2026Google Services | $395.0B | Reported | blend growth (methodology §4.2), growth 15.2% sec.gov ↗ |
| Revenue FY2030Google Services | $623.9B | Rule | §4.2 G1: annual hold/fade blend across 14%–16%; fade weight 62.482244%; growth 10.730810%; FY1 input: Exact H1 2026 / H1 2025 Google Services growth; replaces rounded 15.2%. No annual segment guidance. sec.gov ↗ |
| EBITDA margin FY2030Google Services | 47.8% | Rule | linear path to 47.8% by FY2030 (§4.3 E2: 4.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 12.7% to FY2030; no cited expansion evidence) Valuation methodology §4.3 (current E2) · Read methodology ↗ |
| Equipment per $1 of revenue (k)Google Services | 0.5 | Rule | methodology §4.4: in-service equipment + FY1 capex over FY2 revenue = 0.46 Q2 2026 earnings 2026-07-22: 2026 capex guidance raised to $195–205B |
| Equipment lifeGoogle Services | 7 years | Reported | server life 6 years + 1 for long-lived assets evidence.usefulLivesYears: servers and network equipment 6 years |
| Capex FY2026Google Services | $90.0B | Guidance | midpoint, company total before pool share × 0.45 pool share Q2 2026 earnings 2026-07-22: 2026 capex guidance raised to $195–205B |
| Terminal growthGoogle Services | 3.0% | Rule | methodology §4.2 terminal growth for a growth line Valuation methodology §4.2 · Read methodology ↗ |
| Revenue FY2026Google Cloud | $98.6B | Rule | fade high growth (methodology §4.2), growth 68.0% segmentsQuarterly: H1 2026 $44.80B vs H1 2025 $25.88B (+73%); Q2 2026 +82%; backlog $514B with just over 50% expected to convert within 24 months (Q2 2026 call) |
| Revenue FY2030Google Cloud | $390.5B | Rule | fade high growth (methodology §4.2), growth 29.6% segmentsQuarterly: H1 2026 $44.80B vs H1 2025 $25.88B (+73%); Q2 2026 +82%; backlog $514B with just over 50% expected to convert within 24 months (Q2 2026 call) |
| EBITDA margin FY2030Google Cloud | 45.7% | Rule | linear path to 45.7% by FY2030 (§4.3 E2: 4.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 46.1% to FY2030; no cited expansion evidence) Valuation methodology §4.3 (current E2) · Read methodology ↗ |
| Equipment per $1 of revenue (k)Google Cloud | 1.2 | Rule | methodology §4.4: in-service equipment + FY1 capex over FY2 revenue = 1.22 Q2 2026 earnings: 2026 capex $195–205B |
| Equipment lifeGoogle Cloud | 7 years | Reported | server life 6 years + 1 for long-lived assets evidence.usefulLivesYears |
| Capex FY2026Google Cloud | $100.0B | Guidance | midpoint, company total before pool share × 0.5 pool share Q2 2026 earnings: 2026 capex $195–205B |
| Terminal growthGoogle Cloud | 3.0% | Rule | methodology §4.2 terminal growth for a growth line Valuation methodology §4.2 · Read methodology ↗ |
| YTD revenue through 2026-06-30Google Services | $184.177000B | Reported | Same-scope first-half segment revenue through final T0. sec.gov ↗ |
| YTD GAAP operating profit through 2026-06-30Google Services | $80.133000B | Reported | Note 15 same-scope first-half segment GAAP operating income through final T0; not an allocated consolidated profit. sec.gov ↗ |
| YTD D&A through 2026-06-30Google Services | $6.113700B | Rule | Company reported YTD depreciationB 13.586B × existing pool share 0.45; allocated once, not a reported segment amount. H1 company PP&E depreciation; allocated by the existing 45%/50% capital-pool shares. This allocation is an estimate and is not claimed as reported segment depreciation.; allocation: the rest of the build serves Search, YouTube and Gemini for consumers; 5% left for Other Bets (Diginomica on the Q4 2025 call: just over half of 2026 ML compute goes to Cloud) sec.gov ↗ |
| YTD capex through 2026-06-30Google Services | $36.269100B | Rule | Company reported YTD capexB 80.598B × existing pool share 0.45; allocated once, not a reported segment amount. H1 cash purchases of PP&E, matching the annual cash-capex outlook. Existing pool shares allocate this amount once. Noncash finance lease additions 0.902B and prepayments 0.835B are disclosed separately and not mislabeled as this cash-flow line.; allocation: the rest of the build serves Search, YouTube and Gemini for consumers; 5% left for Other Bets (Diginomica on the Q4 2025 call: just over half of 2026 ML compute goes to Cloud) sec.gov ↗ |
| YTD revenue through 2026-06-30Google Cloud | $44.796000B | Reported | Same-scope first-half segment revenue through final T0. sec.gov ↗ |
| YTD GAAP operating profit through 2026-06-30Google Cloud | $15.412000B | Reported | Note 15 same-scope first-half segment GAAP operating income through final T0; not an allocated consolidated profit. sec.gov ↗ |
| YTD D&A through 2026-06-30Google Cloud | $6.793000B | Rule | Company reported YTD depreciationB 13.586B × existing pool share 0.5; allocated once, not a reported segment amount. H1 company PP&E depreciation; allocated by the existing 45%/50% capital-pool shares. This allocation is an estimate and is not claimed as reported segment depreciation.; allocation: Cloud's share of the build (Diginomica on the Q4 2025 call: just over half of 2026 ML compute goes to Cloud) sec.gov ↗ |
| YTD capex through 2026-06-30Google Cloud | $40.299000B | Rule | Company reported YTD capexB 80.598B × existing pool share 0.5; allocated once, not a reported segment amount. H1 cash purchases of PP&E, matching the annual cash-capex outlook. Existing pool shares allocate this amount once. Noncash finance lease additions 0.902B and prepayments 0.835B are disclosed separately and not mislabeled as this cash-flow line.; allocation: Cloud's share of the build (Diginomica on the Q4 2025 call: just over half of 2026 ML compute goes to Cloud) sec.gov ↗ |
| Share of revenue FY2026Company costs | 4.8% | Reported | trailing four quarters: consolidated operating income minus segment profit = −$21.541B; grows with the non-infrastructure lines' revenue; §4.3.2 G3 same-quarter TTM driver base $444.708B (2026-06-30, 2026-03-31, 2025-12-31, 2025-09-30), annual base $401.426B SEC XBRL 2026-06-30, 2026-03-31, 2025-12-31, 2025-09-30 |
| Share of revenue FY2034Company costs | 4.8% | Reported | trailing four quarters: consolidated operating income minus segment profit = −$21.541B; grows with the non-infrastructure lines' revenue; §4.3.2 G3 same-quarter TTM driver base $444.708B (2026-06-30, 2026-03-31, 2025-12-31, 2025-09-30), annual base $401.426B SEC XBRL 2026-06-30, 2026-03-31, 2025-12-31, 2025-09-30 |
| WACCDiscount rates | 9.87% | Rule | methodology §4.5: market-weighted WACC + 0.459522 point build-out premium: 1pp × clamp(FY1 net debt increase / (2% × equity market value), 0, 1), not rounded FRED DGS10 2021-10-20..2026-10-21 |
| Cost of equityDiscount rates | 9.57% | Rule | r_f 3.87% (5-year average 10-year Treasury yield 3.87% (spot 5.13% on 2026-10-21)) + β 1.14 after Blume adjustment × 5%, rounded to 0.01% (1bp) 60 monthly returns vs SPY, 2021-09..2026-09 (adjusted closes) |
| Tax rateDiscount rates | 19.6% | Rule | §4.5 no tax guidance: arithmetic mean of FY2023/24/25 cash taxes / pretax income: 19.164/85.717, 27.353/119.815, 21.526/158.826. Replaces approximate 16.5% effective-tax proxy; nonoperating gains and cash-tax timing limit the operating-tax approximation. sec.gov ↗ |
| Cash and short-term investmentsBalance sheet | $242.5B | Reported | cash, cash equivalents and short-term investments us-gaap:CashCashEquivalentsAndShortTermInvestments · 0001652044-26-000071 (filed 2026-07-23) |
| BorrowingsBalance sheet | $100.2B | Reported | borrowings due within a year plus long-term borrowings us-gaap:CommercialPaper + us-gaap:LongTermDebtCurrent · 0001652044-26-000071 + us-gaap:LongTermDebtNoncurrent · 0001652044-26-000071 |
| Finance leasesBalance sheet | $2.6B | Reported | finance lease liabilities (capex-like; deducted once) us-gaap:FinanceLeaseLiability · 0001652044-26-000071 (filed 2026-07-23) |
| Preferred stockBalance sheet | $19.3B | Reported | rule 18: not tagged as preferred in XBRL; the common share count excludes conversion shares, so the claim is deducted sec.gov ↗ |
| SharesBalance sheet | 12.230B | Reported | shares outstanding as of 2026-07-15 cover page of 10-Q 0001652044-26-000071 (3 share classes summed) |
| Other Bets · autonomy and emerging servicesNon-operating assets | $107.1B | Rule | Waymo announced a 126B post-money priced round. Retain the pre-existing 85% Alphabet ownership assumption (126 × 85% = 107.1B); 85% is not publicly verified or reported. This mark covers Waymo within Other Bets, not separately valued consolidated subsidiaries or a second future exit value. The segment operating losses are not separately stacked onto a funding-round equity mark. The code corporate line is Alphabet-level costs, not a separate valuation of all remaining Other Bets; non-Waymo scope, ownership and capital funding remain pending user judgment. waymo.com ↗ |
| Noncurrent restricted marketable equity securitiesNon-operating assets | $14.1B | Reported | Note 3 fair value of noncurrent restricted marketable equity securities 14.126B at June 30, outside cash/current securities of 242.474B. The filing does not identify this entire line as SpaceX; current marketable equity includes 87.063B in aggregate and is already bridged once. 10-Q Q2 2026 Note 3: marketable equity securities in other non-current assets $14.1B (SpaceX, restricted through Q3 2027) |
| Private equity stakes remeasured to observable rounds in Q2 2026Non-operating assets | $87.9B | Reported | only the stakes with a recent priced round are counted; the other $36.4B carried at cost is left out 10-Q Q2 2026 Note 3: non-marketable equity securities $124.3B, of which $87.9B remeasured at fair value in the quarter on observable transactions |
| Dividends per yearShareholders | $10.3B | Reported | four quarters at $0.21 × 12.230B shares companyAnnual FY2025 dividends $0.83; quarterly $0.21 |
Research notes
- share-count comparison: 12.309B quarter 2026-04-01..2026-06-30 · 0001652044-26-000071; point-in-time denominator retained
- unallocated company costs: $21.5B a year (4.8% of trailing revenue), growing with the non-infrastructure lines, valued as one negative business
- Google Services: 2 quarter(s) of FY2026 already reported; counted as actuals
- Google Cloud: 2 quarter(s) of FY2026 already reported; counted as actuals
- Google Services: dated YTD inputs through 2026-06-30; omitted metrics retain estimates, company capital-pool amounts allocated once
- Google Cloud: dated YTD inputs through 2026-06-30; omitted metrics retain estimates, company capital-pool amounts allocated once
- cost of equity 9.57% (β 1.14 after Blume adjustment), WACC 9.9% incl. 0.459522-point build-out premium (§4.5 G2)
- Google Services: k 0.5 (calibrated 0.46), life 7 years
- Google Cloud: k 1.2 (calibrated 1.22), life 7 years
- §4.5 G2: FY1 net debt increase $36.442013899794574B / (2% × equity market value $3965.2106000000003B); build-out premium 0.459522pp, measured before premium
Signal Ledger research under one stated scenario — management's targets are delivered — not a forecast that they will be and not investment advice. The research desk (Claude Opus 5.5) gathers filings, guidance and targets; deterministic code applies the samepublished rules to every company and checks the result. Inputs may contain errors; follow the source links before relying on them. Read our valuation methodology →