The entire narrative around Alphabet comes down to a single fear: that AI will eat search. We take that fear seriously, but we think it obscures the rest of the company. Google Cloud is finally making money, YouTube is a standalone advertising and subscription giant, and Alphabet's cost of capital is absurdly low.
We're playing the gap between a one-dimensional narrative and a multi-dimensional company. If AI search monetisation turns out to be even neutral, and Cloud keeps up the pace, today's valuation looks conservative.
What would scare us off: hard data showing that queries and search ad revenue are genuinely shrinking, not just growing more slowly. That is our stated falsifier, and we watch it more closely than anything else in this position.