Alphabet, the parent company of Google, is set to release its quarterly earnings after the bell on Thursday. This comes at a crucial time for US tech giants, who have been facing challenges on Wall Street. Investors have high expectations for Alphabet, as its competitor Meta (formerly Facebook) recently offered a downbeat Q2 forecast, causing its stock to plummet. Wall Street will closely scrutinize Alphabet's updates on its AI investments and the digital ad market. Analysts expect strong revenue growth for Alphabet, with a focus on metrics such as cloud revenue and ad revenue.

The tech industry as a whole is under pressure, as investors worry about interest rate concerns. Strong corporate updates from tech giants like Alphabet could provide a boost to the equity rally, while lackluster performances may exacerbate uncertainty. Analysts will be particularly interested in Alphabet's progress on integrating AI into its search tools and the impact on ad revenue. The company is also expected to expand its cloud business to compete with rivals Amazon and Microsoft. Alphabet's report comes amidst a turbulent period for the company, with CEO Sundar Pichai announcing a restructuring of its AI teams and firing employees involved in protests against a controversial project.