Chicago, IL – April 24, 2025– Today, Zacks Investment Ideas feature highlights Alphabet GOOGL, NVIDIA NVDA and CrowdStrike CRWD.
Alphabetjust made its largest acquisition ever with the $32 billion bid for Wiz, an Israeli tech company focused on cloud security.
Typically, Google has liked to build new technologies and platforms in-house, especially via their secretive "Skunkworks" R&D lab.
So why did they spend more than all 20 previous acquisitions combined? What do they see in cloud security and how big will the synergies and payoffs be as they compete with market leaders AWS and Azure?
Sundar Pichai, Alphabet's CEO, joined Google in 2004 and was largely responsible for leading engineering teams and innovations on Chrome, Drive, and Gmail. He highlighted the strategic importance of the Wiz acquisition, emphasizing its role in bolstering Google Cloud's security capabilities, particularly in the context of the growing adoption of AI and the increasing prevalence of multi-cloud and hybrid environments.
In his typical, understated manner, Pichai called Wiz an "innovative, leading cloud security platform" that will help Google Cloud "turbocharge improved cloud security." He also noted that the acquisition aligns with Google's broader strategy of diversifying beyond its core advertising businesses.
I think Sundar just bought a CrowdStrike-equivalent for 66% off. Here's why as we consider the "tale of two clouds."
There is the cloud for everyone. And then there is the cloud that enterprises will pay a premium for to call their own.
This is what NVIDIA CEO Jensen Huang has described as the AI "research and security" imperative of large organizations in this new age where data is the new gold. And they need a new Fort Knox.
Not only do they need to mine and model their own data for strategic insights, they need to protect it in their own silos... er, bunkers. And he says the same goes for nation-states because the bad actors are getting more sophisticated and aggressive with AI in their threat and attack strategies.
So what happened two weeks ago shouldn't be a surprise to anyone who follows the big cloud service providers (CSPs).
Google held their Cloud Next event April 9-11 and Jensen was virtually in the wings as cheerleader extraordinaire unveiling a "super-partnership" for Agentic AI Reasoning and secure cloud access to models and data.
From the NVIDIA post on X...
Announced at #GoogleCloudNext: NVIDIA and @GoogleCloud are bringing #agenticAI on-prem with support for Google Gemini models—powered by NVIDIA Blackwell and Confidential Computing for top-tier performance and security.
Jensen made a special 60-second video to talk about the collaboration and gave high praise...
"No company is better at every single layer of computing than Google and Google Cloud."
In the last 20 seconds of the video, Jensen crystalizes it all with a theme I've been stressing: corporations and countries need enhanced security and "edge" applications with their AI data R&D...
Literally every single layer and every single aspect of computing, every industry, every company, every country wants to get their hands on AI. However, everything has to be fundamentally confidential and secure, and so we're announcing something utterly gigantic today, Google Distributed Cloud, Gemini and NVIDIA are going to bring state of the art AI to the world's regulated industries and countries. Now, if you can't come to the cloud, Google Cloud will bring AI to you.
Jensen dropped a key hint there with the word "regulated." Industries across finance, healthcare, energy and transportation have unique security risks with their systems and customer data. None of us want our private data exposed, but when thousands of jobs are on the line, the stakes are even higher.
Even the guardians can make mistakes as we saw last summer when a software update from cybersecurity firm CrowdStrike caused widespread IT outages, impacting millions of Windows devices globally.
When you think about the security and operational needs of large enterprises and the ability to have dedicated, on-prem (local), and private use of their data, their "clouds" must be accelerating excellence in multiple ways.
That's why the Google Cloud + NVIDIA partnership makes so much sense.
And this is not just a matter of corporate "secrets." As I discuss frequently in my articles and TAZR commentary about the development of AI for autonomous machines like cars, robots, and military drones -- where NVIDIA is providing the foundational infrastructure -- this is an issue of national security.
If you've been observing how the explosion of AI tools and platforms is disrupting every industry, you already get that security of data, systems, and computation is of the utmost priority. But its the pace of advance, including from the bad actors, that will continue to astonish us every so often with another big breach.
Former Google chief Eric Schmidt has been very vocal lately that ASI -- artificial super intelligence -- is very close. Maybe only 5 years away. That means security threats will grow exponentially too. If you want a copy of my latest report on this, just email KCook@Zacks.com.
And stay tuned as I cover the Alphabet earnings call on Thursday 4/24.
Cooker
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