Google’s parent company, Alphabet, has recently escaped a significant legal challenge. However, as a second antitrust lawsuit focusing on digital advertising is scheduled to recommence on September 22, the implications for Google’s stock may not be as favorable.
In early September, Google’s shares saw an upswing following a federal judge’s ruling that no asset divestitures would be mandated as part of remedies in an antitrust case related to the tech behemoth’s search operations.
However, the looming digital advertising case addresses different concerns. In April, U.S. District Court Judge Leonie Brinkema identified that Google has employed traditional monopoly strategies to consolidate its power in online advertising.
The Department of Justice has contended that Google’s market dominance has adversely affected both advertisers and content creators.
Beginning on September 22, Judge Brinkema will convene hearings to explore potential remedies.
The government has proposed that Google divest its Google Ad Manager, which encompasses the publisher ad server and the accompanying ad exchange. These components play crucial intermediary roles in the marketplace that connects buyers and sellers.
Judge Brinkema is anticipated to render a ruling on remedies in early 2026.
Still in Turbulent Waters?
“Google remains ensnared in a precarious situation,” remarked BMO Capital Markets analyst Brian Pitz in a report.
“In contrast to the search case, we anticipate a greater likelihood of a structural remedy in this instance,” he added.
Entities such as Trade Desk, PubMatic, and Magnite have vested interests in the judge’s forthcoming decision. Furthermore, Amazon.com may also benefit, contingent upon the legal remedies implemented.
“Demand-side” players like Trade Desk are instrumental in assisting advertisers, brands, and media agencies in acquiring advertising space, whereas “supply-side” counterparts such as Magnite and PubMatic collaborate with publishers, media proprietors, and app developers who offer ad space on websites.
“In the realm of the ad-tech trial, the intricate relationship between Google Ad Manager and the supply-side assets of AdX, along with the effect on ad auctions, stands as the primary contention,” noted Raymond James analyst Andrew Marok in a report. “Although a behavioral remedy remains a possibility, we perceive a structural solution as more probable.”
Is Google Divesting Ad Manager?
Reports suggest that Google is bracing for a potential reorganization by engaging with ad buyers regarding forthcoming alterations to Google Ad Manager.
This situation has generated comparisons to the “DoubleClick trial.” In 2008, Google acquired the prominent digital advertising firm DoubleClick for a staggering $3.1 billion, leveraging its technology to access comprehensive ad measurement data online.
Google’s digital advertising enterprise is vast, comprising numerous intricacies.
In the realm of search, competition has intensified due to the emergence of challengers like OpenAI’s ChatGPT and Perplexity, compelling Google to revamp its search outcomes. While ChatGPT provides direct answers to queries, Google traditionally relied on delivering links.
Beginning in mid-2024, Google commenced the rollout of AI Overviews in the U.S., presenting conversational summaries above links for numerous queries. A pivotal long-term query remains as to how this new format will influence Google’s search ad revenue trajectory.
Moreover, the advent of AI agents, capable of autonomously performing tasks for users, including shopping, introduces further competition, potentially diverting traffic away from Google as bots navigate the web instead of relying on traditional search results.
Technical Ratings of Google Stock
According to a Citigroup analysis, Google’s approach to search engine optimization (SEO) could transition towards agentic engine optimization (AEO). Additionally, the conventional cost-per-click (CPC) model may evolve into a “cost per agentic action” (CPAA), as articulated in the Citi report.
Meanwhile, Google stock has experienced a 24% uptick in 2025, recovering from its previous underperformance in the year’s first half.
This Composite Rating consolidates five distinct proprietary assessments into a singular, user-friendly gauge. Optimal growth stocks typically receive a Composite Rating of 90 or higher.
Additionally, Google stock has secured an Accumulation/Distribution Rating of A-, which evaluates price movements and trading volume over the past 13 weeks. This rating suggests that institutional buying has outpaced selling.
Source link: Inkl.com.
