Alphabet ($GOOGL) Posts Worst Post-Earnings Drop on Record — AI Threatens Search
GOOGL fell ~13.7% after missing revenue and EPS estimates, erasing up to $520B in market cap in a single session — the second-largest single-day wipeout in US market history — as AI-mode searches cannibalize Google's core ad business.
What we know
Alphabet shares collapsed as search revenue growth slowed to 12% in Q3 from 17% in Q2, missing the ~15% consensus estimate. Free cash flow came in at -$9.07B. The FT reported that 'AI mode' searches are directly threatening profits at the core advertising business. Google Cloud revenue did surge 103% YoY to $30.7B. An account on X noted the ~$500B wipeout is the second-biggest single-day US market cap loss in history, behind only NVDA's ~$600B. Counterpoint from another account on X: Grok uses Google Search and OpenAI Dots uses Bing, suggesting AI isn't abandoning Google Search. Another account on X also flagged Microsoft preparing a $25B bond sale — its first since 2017 — to fund AI infrastructure, underscoring the massive capital demands of the AI buildout.
Sources
“AI mode searches were threatening profits at its core advertising business”
View post →By the Global Eye 24 desk, with AI assistance. Updated as the story develops. Spot an error? Write to corrections@globaleye24.com.