Alphabet’s GOOGL Google has updated over 20 first-party apps for large screens in a bid to deliver an enhanced experience for Android tablet users.
The updates boast features like dual-column User Interface for apps like Google Files, Play Store and Google Contacts, to name a few, offering a leveraged view of the customers’ search results.
Further, Google updated a Navigation rail feature for Google Drive, which provides four tabs with an additional FAB tab for creating new files/folders, offering customers a Desktop experience on their tablet.
Further, the sidebar for Google Weather, with a 10-day high/low and weather conditions forecast, is an added feature update.
The latest move is expected to boost the quality of Google’s first-party apps. This, in turn, is likely to bolster the download rate of these apps.
Further, the move will enhance the Android experience of tablet users. This is likely to add to the popularity of Android, as well as accelerate its adoption rate.
Thus, this is expected to benefit the Google Services segment of Alphabet.
Google’s Android app update for tablet users is likely to aid its competitive position against its peers like Apple AAPL and Microsoft MSFT, which are also leaving no stone unturned to provide enhanced customer experience to tablet users.
Notably, Apple, which is set to release iPadOS 17, boasts new features from iOS 17, and other updated features including tablet-specific enhancements, interactive widgets, a revamped lock screen experience and new apps.
Meanwhile, Microsoft is set to release the newest version of its Surface Go series, Surface Go 4, featuring an upgraded Intel Core i3-10100Y chip, aimed at commercial customers, with a more repairable internal layout and replaceable components.
Growing Efforts to Boost Google Services
The latest move bodes well for the company’s increasing efforts to bolster the Google Services segment, which accounts for Alphabet’s majority of total revenues and is clearly visible from Google’s recent update initiative.
Apart from this, Google recently added a text-formatting feature to its note-taking app Google Keep, allowing users to format bold, italicized and underlined text and split thoughts into sections, with a few new buttons for more customization.
Further, Google added 25 more free channels to Google TV, including shows like Top Gear, Baywatch, music channels and several game shows. This helps the company cater well to the rising demand for free streaming services.
All the abovementioned endeavors are expected to continue aiding the performance of the Google Services segment.
In second-quarter 2023, Google Services’ revenues increased 5.5% year over year to $66.3 billion, accounting for 88.8% of total revenues.
Our model projects Google Services revenues for 2023 at $267.05 billion, indicating growth of 5.3% from 2022.
we believe momentum in the underlined segment will likely aid its overall financial performance. This, in turn, will likely instill investor optimism in the stock.
Our model estimate for 2023 total revenues stands at $300.45 billion, indicating year-over-year growth of 6.2%.
Alphabet has gained 53.4% on a year-to-date basis compared with the industry’s growth of 52.1%.
Zacks Rank & Stock to Consider
Currently, Alphabet carries a Zacks Rank #3 (Hold).
A better-ranked stock in the broader technology sector is Adobe ADBE, which carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Adobe have gained 61.1% in the year-to-date period. ADBE’s long-term earnings growth rate is projected at 13.27%
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