Google investors have big expectations after stock’s sharpest quarterly rally in 20 years

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Alphabet

has a high bar to clear when it reports earnings Wednesday.

The company’s stock price soared 38% in the third quarter, its best quarterly performance in two decades. It’s continued to rally, climbing 11% so far in October, closing at a record on Monday.

With revenue growth stuck in the low teens of late, and expected to come in at 12% next year, investors have recalibrated their expectations after witnessing speedier growth in the years before the 2022 slowdown. Much of the recent optimism centers around Google’s improved position in the artificial intelligence race.