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Alphabet (GOOGL) to Aid Android Users With Messages App Upgrade

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Alphabet (GOOGL - Free Report) is testing to add a feature update to the Google Messages app in order to enhance Rich Communication Services (RCS) conversations among Android users.

With this new redesign for RCS, Google Messages users will be able to view the image first, followed by the message, which is joined by curving text bubble corners to match the photo top.

Alphabet expects to deliver an enhanced experience to Android users using the messaging app on the back of its latest redesign.

Moreover, it will enable Google to capitalize on solid growth opportunities present in the global mobile messaging market, which, per a Future Market Insights report, is expected to reach $443.53 billion by 2033, indicating a CAGR of 15.9% between 2023 and 2033.

Year-to-Date Performance

Zacks Investment Research
Image Source: Zacks Investment Research

Expanding Android Offerings Aid Google Services

Alphabet’s shares have rallied 33.2% in the year-to-date period, outperforming the Zacks Computer & Technology sector’s return of 28.7%. The company is benefiting from strength in the Google Services segment.

The latest move to boost Google’s messaging app bodes well for the company’s increasing efforts to strengthen its Android offerings, which play a vital role in driving the prospects of the Google Services segment.

Google recently upgraded the Locked Folder for Google Photos to bolster its Android offerings. With this new upgrade, a “Locked” option appears directly next to the Favorites, Archive and Trash options in the Google Photos app for much faster access.

Alphabet also upgraded Google Keep on Android tablets and foldables, which now supports multi-accounts when two instances of the app are open. This allows users to view two notes simultaneously on the left and right sides of the screen.

It also introduced a “Lookup” reverse number shortcut feature on the Google Phone app on Pixel devices, further bolstering its Android app offerings.

These efforts are expected to drive the performance of the Google Services segment, which, in turn, will likely contribute to the overall financial performance of the company in the near term.

The Zacks Consensus Estimate for 2024 total revenues stands at $291.26 billion, indicating year-over-year growth of 13.6%.

The consensus mark for 2024 earnings is pegged at $7.60 per share, indicating a 31.03% rise from the year-ago figure. The figure has been revised upward by 0.4% in the past 60 days.

Zacks Rank & Stocks to Consider

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

Some better-ranked stocks in the broader technology sector are Arista Networks (ANET - Free Report) , Garmin (GRMN - Free Report) and Apple (AAPL - 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.

Arista Networks shares have gained 42.1% in the year-to-date period. The long-term earnings growth rate for ANET is 16.07%.

Garmin shares have gained 26.6% in the year-to-date period. The long-term earnings growth rate for GRMN is currently projected at 8.04%.

Apple shares have gained 20.1% in the year-to-date period. The long-term earnings growth rate for AAPL is 12.48%.

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