Equities Update: Alphabet, Wetherspoons, Tesla, Fresnillo…

Alphabet earnings: AI progress, cloud momentum, but can it hold the line on search?

Chris Beauchamp, chief market analyst, IG

Alphabet reports after the bell, and this quarter could be a litmus test for its future. The numbers are expected to show solid year-on-year growth – around 10% on revenue and 12% on profit – but the bigger story is how the business is evolving under pressure.

Search, still the engine room, is facing its most credible threat in years. The rise of ChatGPT-style platforms has changed how people access information – and Alphabet’s response, Gemini, is now central to its strategy. With half a billion users already, and AI-powered search reaching 1.5 billion monthly users, the tech is clearly landing. But can it boost revenue without cannibalising the core business?

Google Cloud continues to shine, with expected growth of 26% and new firepower from the proposed $32bn Wiz acquisition. The business is closing ground on Amazon and Microsoft, and Alphabet’s ability to cross-sell AI across its platforms is giving it an edge.

But not all the pressure is commercial. The company is still entangled in regulatory battles on both sides of the Atlantic. Potential remedies could reshape its business model and few investors would shrug off the idea of a forced Chrome divestment.

Still, with profit margins improving and Wall Street largely supportive, Alphabet enters earnings in decent shape. But with the stock’s valuation off its highs and nerves around the future of search, tonight’s report needs to deliver more than just steady growth – it needs to show leadership.

Sunshine lifts Wetherspoons’ sales but clouds remain on the horizon

Adam Vettese, market analyst for eToro says: “Wetherspoons’ latest trading update serves up a reassuring performance, with sales up a healthy 5.1% over the past 12 weeks as punters flock to the pub during the recent favourable weather spell. Plans to open around 15 new managed pubs, alongside a similar number of franchised sites, mark a cautious but confident return to expansion after years of trimming the estate.

“Still, it’s not all plain sailing. The company continues to face a hangover from rising wage and tax costs, forecast to add around £60 million a year to the bill, putting pressure on operating margins. Net debt is expected to edge up to £720 million, as Wetherspoon invests in freeholds and refurbishments.

“While full-year profit guidance remains intact, it’s clear that cost inflation is nibbling away at the group’s bottom line. Overall, the update shows Wetherspoon retaining its firm grip on the value-led end of the market, with strong sales and selective growth plans. But with little pricing power and a hefty tax tab, investors may want to sip rather than gulp when it comes to expectations for margin recovery.”

Alphabet Q2 2025 earnings preview

Lale Akoner, global market analyst at eToro says: “We expect a clean quarter from Alphabet tomorrow, with growth accelerating in Search and YouTube businesses, potentially helped by currency and steady demand. AI Overviews and AI Mode are starting to change how people search, as now clicks are down but conversions are holding up. That suggests users are searching with more intent, which is good for ads, as advertisers get better return on ad spend (ROAS), even if overall traffic is lower.

“An important medium-term risk we are going to monitor is the DOJ trial in August. A ruling banning exclusive search defaults would not hit revenue right away but it may open the door for ChatGPT or others to chip away at distribution.

“Overall, for us, the real question is whether Google’s AI features are helping or hurting the core business. Right now, most of the growth in search revenue still comes from better ad targeting, not more commercial queries. That’s a risk if new AI tools from other platforms start to compete for those high-value searches. So far, that does not seem to be happening. But if Google cannot show that it’s monetizing AI without hurting the main ad engine, we think the upside case gets harder to argue.”

Tesla earnings in focus as Elon’s distractions pile up

Josh Gilbert, aarket analyst at eToro: “Even if Tesla delivers a solid set of numbers, it’s unlikely to escape heavy scrutiny when it reports earnings on Wednesday, US time. The optimistic scenario is that cost-cutting efforts and developments in AI and autonomy provide some relief. Realistically, expectations are low. Vehicle sales are under pressure, with global deliveries falling 13.5% year-on-year in Q2 to 384,122, missing analyst estimates. The Cybertruck has also been arguably somewhat of a flop so far, with a third consecutive quarter of falling sales now hitting their lowest point in a year.

“Elon’s position as a Tony Stark-like personality at the head of the company was a boon for a long time, but it’s hard to argue that his prominence isn’t having some detrimental effect on the brand. Despite the Tesla CEO’s broad commitment to step away from politics after his controversial time with DOGE, he has almost immediately opted to pursue founding his own US political party. Having previously been criticised as being absent as Tesla’s CEO, these renewed political aspirations are unlikely to please investors hoping for a steadier hand at the helm of Tesla.

“Elon is also eyeing Tesla’s cash reserves in the hopes of transferring some of those funds across to his private artificial intelligence company, xAI. This will require Tesla investor approval, and even if there is a theoretical future benefit for Tesla in doing so, it’s going to be a very hard case to make.

“There are still high points to look for in this earnings call. Tesla remains a market leader and is making progress in autonomous driving, particularly with its Robotaxi program. That’s worth watching closely, though meaningful revenue is still years off, it remains a pillar of Tesla’s long-term growth strategy.

“However, while investors continue to buy into Tesla’s autonomous and robotics vision, it’s a narrative that is nearly a decade in the making. Musk first promised full self-driving capabilities back in 2015, with shifting timelines almost every year since. The Robotaxi reveal earlier this year was positioned as a major breakthrough, but the market will want more than promises and prototypes; it’s now looking for progress. Tesla’s valuation, still more than 20 times that of General Motors despite delivering far fewer vehicles, reflects expectations of transformational growth. But if the company continues to underdeliver, that valuation gap becomes increasingly difficult to justify.

“Tesla is a household name, and even amidst the chaos of Musk, there is a solid company at work here. That’s why it maintains its position as the second most-held stock on the eToro platform globally and why so many shareholders back it as a long-term investment. Markets expect EPS of USD$0.44, down 20% year over year, while revenue is set to fall 11% to USD$22.8 billion. With weakening fundamentals, leadership distractions and delivery shortfalls in focus, this is a big call for Elon Musk, and he’ll need to deliver some Musk magic to turn Tesla’s 2025 fortunes around.”

Silvers rally breathes new life into Fresnillo

Mark Crouch, market analyst for eToro, says: “After years of trailing the pack, 2025 has seen Fresnillo shares take off as silver prices surge and investors pile back in. This is the run long-term holders have been waiting for, with silver pushing higher on renewed safe-haven demand and growing industrial use, momentum is firmly behind the move. And although Fresnillo’s latest production update might slightly disappoint investors with “silver production being impacted by weaker Silverstream contribution and lower grades at the Fresnillo mine.”

“The real question now is how high can silver go, and will energy prices stay low enough to keep input costs in check? If they do, this rally could have serious legs. One thing’s certain, mining investors know this story all too well. Long spells of frustration, then explosive moves when commodity prices turn. Now, with silver even looking to outshine gold, Fresnillo is finally delivering operationally, and getting the market recognition it’s been waiting for.”