11:15 AM EST, 01/14/2025 (MT Newswires) -- Alphabet's (GOOG, GOOGL) 2025 performance will hinge on developments in artificial intelligence and regulatory outcomes as the Department of Justice search case and other risks present potential headwinds, BofA Securities said in a note Tuesday.

Increased Google AI Overview usage, better AI-driven performance across business lines, potential resolution of the DOJ search case, stronger contributions from the cloud business, and cost-cutting or new disclosures under the new CFO will act as key catalysts for Alphabet's stock, according to the note.

Risks include volume losses to competitors, adverse DOJ ruling, policy changes under a new US administration, legal issues in the European Union, and higher AI capital expenditures, the note added.

BofA said that Google's ( GOOG ) AI Overviews have strong potential to sustain healthy search trends while the company will benefit from cost discipline measures, including a stabilized headcount and actions by the new CFO.

The brokerage raised the price objective on Alphabet's stock to $225 from $210, and reiterated its buy rating.

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