Alphabet posted its second-quarter earnings after Wednesday's closing bell, beating on the headline numbers and giving a higher forecast for this year's capital expenditures. But some analysts say the debate over the future of Google's search empire is still unsettled.

Alphabet shares rose more than 3% in early trading on Thursday as the Google parent's earnings underscored a key message to investors: AI spending is climbing, but so are the returns.

Most leaders in the tech industry owe their wealth to founding equity stakes in their platforms, which Google’s Sundar Pichai does not have.

Though Google Cloud is dominating headlines for its surprising outperformance, Alphabet’s core ad business remains robust. Google Search brought in revenue of $54.19 billion for the quarter, growing 12% year over year, while YouTube Ads revenue jumped 13% to $9.8.

Alphabet Inc.’s Google inked a deal worth more than $1 billion to provide cloud-computing services to software firm ServiceNow Inc., a win for Google Cloud’s efforts to get major enterprises onto its platform.

Many of Pichai's recent sales were made under a regulatory filing which allows stock sales to be set up in advance by officers of publicly-listed companies to avoid any accusations of inside trading.

The S&P 500 and the Nasdaq notched record high closes on Thursday as robust results from Google parent Alphabet fueled optimism about other heavyweight artificial intelligence stocks, while Tesla slumped after the electric vehicle maker's results disappointed investors.

Alphabet is set to report its second-quarter earnings after the bell Wednesday. Wall Street expects the company to post double-digit revenue growth, according to LSEG estimates. Google made several AI announcements and talent plays during the quarter. Alphabet is set to report its second-quarter earnings after the bell Wednesday.