Alphabet faces AI monetization test at Google I/O, Marketing Live as Citi keeps GOOGL buy rating

Alphabet Inc. (GOOGL) will hold Google I/O on May 19, 2026, and Google Marketing Live on May 21, 2026, with investors focused less on a possible Gemini 4.0 release and more on whether AI can drive revenue across search, advertising, shopping and cloud. Citi analyst Ronald Josey maintained a buy rating and a $447 price target, saying Gemini remains competitive and AI tools are lifting global query growth. He cited Google Cloud backlog of $462.3 billion, nearly double sequentially, and first-quarter cloud revenue of $20.03 billion, up 63.4%. Citi’s target is based on about 30 times projected 2027 GAAP EPS of $14.75. Key investor watch points include AI search monetization, AI Max adoption in advertising, agentic shopping and Gemini’s role in enterprise cloud demand. AI-driven tools already account for more than 30% of search ad spending, while AI Max is set to fully replace Dynamic Search Ads in September 2026. Regulatory risk, ad budget pressure and AI competition remain valuation headwinds.