On Friday, Bank of America said investors should expect a heavy artificial intelligence focus at next week’s developer conference from Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG), with new Gemini AI models, agentic capabilities and smart glasses among the key announcements likely to dominate the event.

BofA Maintains Bullish Alphabet Outlook

In a research note published Friday, BofA analyst Justin Post reiterated a Buy rating on Alphabet and maintained a $430 price forecast, implying about 7% upside from Thursday’s close of $401.07.

Alphabet’s annual Google I/O developer conference begins May 19. BofA said expectations heading into the event are elevated, but the conference could reinforce confidence in Google’s long-term AI positioning through deeper Gemini integration across products and advances in autonomous AI assistants.

However, the analyst warned that a lack of a major “wow” announcement could pressure the stock.

Gemini AI Upgrades And Developer Tools In Focus

The firm expects Google to unveil either Gemini 4 or a major Gemini 3.X upgrade featuring stronger reasoning, coding, multimodal and long-context capabilities, along with faster and cheaper Flash model variants. BofA also expects expanded AI-generated video, image and audio tools, plus more advanced software engineering agents.

Agentic AI Expansion Across Google Ecosystem

BofA said Google could showcase broader “agentic AI” capabilities across Chrome, Gmail, Maps, Calendar, Search and Android, allowing Gemini to autonomously complete tasks such as booking reservations, managing shopping workflows and editing calendars. Chrome may also gain AI-powered browsing tools capable of interacting with websites and executing multi-step actions.

Smart Glasses And Android Updates Expected

The bank also expects updates tied to Android 17, AI-powered operating system initiatives and Project Aura smart glasses, which could launch in the second half of 2026.

Competitive Risks And Valuation Watch

BofA said Google’s expanding AI ecosystem could increase competitive pressure on transaction-based internet platforms that depend on search traffic and referral activity, though widespread adoption of AI agents is still likely years away.

The firm said key drivers for Alphabet shares going forward include Gemini innovation, AI-powered improvements across Google products, stronger AI search utility and momentum in smart glasses and operating systems.

However, BofA cautioned that with Alphabet trading near 27 times estimated 2027 earnings, further multiple expansion may require meaningful “AI surprises” from the event.

Alphabet Price Action

GOOGL Stock Price Activity: Alphabet shares were down 1.29% at $395.90 at the time of publication on Friday, according to Benzinga Pro data.

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