ANKARA, TURKIYE – AUGUST 26: In this photo illustration Google logo is being displayed on a mobile phone screen, in front of Meta logo in Ankara, Turkiye, on August 26, 2025. (Photo by Harun Ozalp /Anadolu via Getty Images)
Anadolu via Getty Images
Alphabet (NASDAQ: GOOGL) and Meta Platforms (NASDAQ: META) saw contrasting stock reactions following their third-quarter earnings reports, despite both being key AI plays.
Google stock rose 8% in extended trading, driven by a solid Q3 performance. The company reported revenue of $102.4 billion for the three months ended September 30, surpassing Wall Street expectations of $99.85 billion. This sales growth was significantly boosted by Google Cloud, which saw a 34% revenue jump to $15.2 billion. Furthermore, adjusted earnings per share (EPS) of $2.87 well exceeded both the projected $2.27 and the year-ago EPS of $2.12.
Conversely, Meta Platforms’ stock dropped 8% in extended trading hours following its downbeat results. Meta reported Q3 revenue of $51.24 billion and EPS of $1.05. While the revenue slightly topped the $49.6 billion expectation, the EPS was a significant miss compared to the projected $6.72, a shortfall largely attributed to a one-time, tax-related charge. The pre-earnings investor interest and subsequent stock decline might also reflect profit-taking.
Despite Google’s strong quarter, we favor Meta. Our preference is based on Meta’s stronger underlying revenue growth performance over key periods, its better operating margins, and a relatively lower valuation compared to Google. The current pre-market stock pullback also offers a more attractive entry point for investors. Consider the data below:
- META’s latest quarterly revenue growth was 26%, vs. GOOGL’s 16%.
- In addition, its Last 12 Months revenue growth came in at 15.2%, ahead of GOOGL’s 13.6%. See how Meta’s financials compare to its peers.
- META has stronger profitability across both periods, with LTM margin at 42.6% and 3-year average at 34.6%.
That being said, if you seek an upside with less volatility than holding an individual stock like META or GOOGL, consider the High Quality Portfolio. It has comfortably outperformed its benchmark—a combination of the S&P 500, Russell, and S&P MidCap indexes—and has achieved returns exceeding 105% since its inception. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.
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Valuation & Performance Overview
Valuation & Performance Overview
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But do these numbers tell the full story? Read Buy or Sell GOOGL Stock to see if Alphabet’s edge holds up under the hood or if Meta Platforms still has cards to play (see Buy or Sell META Stock).
Historical Market Performance
Historical Market Performance
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No matter how good the numbers, stock investment is never a smooth ride. There is a risk you must factor in. Read META Dip Buyer Analyses to see how the stock has fallen and recovered in the past.
Remember, investing in a single stock without comprehensive analysis can be risky. Consider the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid-, and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.