01:38 PM EDT, 07/18/2025 (MT Newswires) -- Alphabet (GOOG, GOOGL) is expected to post better-than-projected second-quarter results amid a boost from an improved macro environment and foreign exchange tailwinds, BofA Securities said Friday.

The Google ( GOOG ) parent is scheduled to report its latest quarterly results Wednesday. BofA projects earnings at $2.21 a share on gross revenue of $95.34 billion. Wall Street is looking for $2.15 and $93.69 billion, respectively, according to the brokerage.

The results are likely to get a boost from an improved economic backdrop, foreign exchange tailwinds, and ad checks that suggest "solid revenue execution during a search transition to (artificial intelligence) results," BofA analyst Justin Post said in a note to clients. "Aided by (foreign exchange), we now expect stable to accelerating growth across most business lines, along with modest margin expansion."

The brokerage said its channel checks indicate Google ( GOOG ) ad spend growth was stable in the second quarter, with monthly growth improving through the period. "We think improving spend as (the second quarter) progressed would be a positive given fears on growing AI competition," Post wrote.

Checks also point to new AI search features driving lower click volumes, though the revenue impact has been countered due to higher conversion rates, according to the note.

YouTube ( GOOG ) checks show that the platform was affected by April pullbacks in spend, though it is benefiting from "shared data enhancements across the broader Google ( GOOG ) ads ecosystem," the analyst said. Checks indicate that recent innovations are making YouTube ( GOOG ) ad budgets "more resilient" to macro challenges, Post said.

BofA raised its price objective on the Alphabet stock to $210 from $200 while reiterating its buy rating.

"On (the company's second-quarter earnings) call, we see further potential for new disclosures, particularly around Gemini advancements and usage ramp, and we would look for commentary on impact of new AI search features on user behavior and monetization," Post said. "We think investors still see disclosures and strategic commentary as lacking, and some would like a more aggressive Google ( GOOG ) for AI share."

BofA increased its annual EPS estimates for Alphabet through 2027.

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