Alphabet’s (GOOGL Quick QuoteGOOGL - Free Report) second-quarter 2022 results, scheduled to be released on Jul 26, are likely to reflect gains from its strengthening cloud service offerings.

The company’s cloud services arm — Google Cloud — has become the key catalyst behind its business growth.

Alphabet’s cloud offerings include Google Cloud Platform and Google Workspace, which have been continuously gaining momentum in the booming cloud computing market. Google’s growing investments in infrastructure, security, data management, analytics and AI have been major positives.

The Google Cloud segment, which derives revenues from fees collected for Google Cloud Platform services and Google Workspace collaboration tools, has constantly been driving substantial revenue growth for Alphabet.

Revenues from the segment were $5.8 billion in first-quarter 2022. The figure accounted for 8.6% of total revenues and exhibited year-over-year growth of 43.8%.

For second-quarter 2022, the Zacks Consensus Estimate for Google Cloud’s revenues is pegged at $6.4 billion, suggesting growth of 38.6% from the prior-year quarter’s reported figure.

Click here to know how the company’s overall second-quarter results are likely to be.

Factors to Consider

Google’s strengthening efforts toward expanding its cloud services portfolio, data centers, availability zones and regions are likely to have helped it gain share in the highly competitive cloud market. The opening of a region in Paris is likely to have been a positive for the company.

Its robust strength in real-time data, analytics and AI, along with its open and scalable cloud infrastructure, is expected to have helped win customers.

The company unveiled the Cloud SQL for SQL Server, which aids in monitoring Cloud SQL with SQL Server database auditing.

GOOGL opened Google Public Sector in the second quarter, which is likely to have aided its momentum among the public sector institutions in the United States.

The company also introduced Climate Insights powered by Google Earth Engine, which runs on Google Cloud and combines AI and machine learning capabilities with geospatial analysis. This is likely to have helped deliver an enhanced experience to the public sector agencies involved in climate research activities.

All these endeavors are likely to have contributed well to the second-quarter performance of Google Cloud.

Additionally, the underlined segment is expected to have continued benefiting from the growing adoption of the hybrid work model worldwide.

Zacks Rank & Stocks to Consider

Currently, Alphabet has a Zacks Rank #3 (Hold).

Investors interested in the broader Zacks Computer & Technology sector can consider some better-ranked stocks like Aspen Technology (AZPN Quick QuoteAZPN - Free Report) , Asure Software (ASUR Quick QuoteASUR - Free Report) and Agilent Technologies (A Quick QuoteA - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Aspen technology has returned 15.1% in the year-to-date period. The long-term earnings growth rate for AZPN is currently projected at 16.3%.

Asure Software has lost 29.7% in the year-to-date period. ASUR’s long-term earnings growth rate is currently projected at 14%.

Agilent Technologies has lost 27.9% in the year-to-date period. The long-term earnings growth rate for A is currently projected at 10%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.