Alphabet (Google’s parent company) shares fell about 13% on Thursday after the company reported its third-quarter results. The stock was on track for its worst single-day fall since the company went public in 2004.
The sharp fall put nearly $500 billion of Alphabet’s stock market value at risk. This would make it the second-biggest one-day loss in market value for a US-listed company.
Nvidia record loss remains ahead
Nvidia recorded the biggest one-day loss in market value among US-listed companies, losing about $593 billion on January 27, 2025. The fall came after China’s DeepSeek AI model worried investors about the future of the artificial intelligence industry, Yahoo Finance reported.
Alphabet’s stock would need to close at around $274.75, down about 15%, to match Nvidia’s record loss, according to Yahoo Finance’s calculations. Alphabet’s loss has already crossed the roughly $400 billion wiped out from SpaceX’s market value on June 22, which was previously the second-biggest one-day loss.
Alphabet shares see biggest dollar loss
Thursday’s fall was set to become Alphabet’s biggest-ever loss in market value in dollar terms. Its previous record was a loss of about $275 billion on July 23.
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Alphabet was also on track for its steepest stock decline following an earnings report since it went public in 2004. According to Bespoke Investment Group, the previous record was a fall of nearly 10% in July 2008.
Google Cloud revenue doubles, Gemini users cross 1 billion
Alphabet’s third-quarter results showed strong growth in its cloud business. Google Cloud revenue more than doubled to about $31 billion, showing continued demand for the company’s cloud services.
Google’s Gemini AI app crossed 1 billion users, marking another major milestone for Alphabet’s artificial intelligence business. However, the strong user numbers did not prevent the company’s shares from falling sharply after its earnings report.
Google Search revenue misses estimates
Google’s search business continued to grow, but its performance fell short of Wall Street’s expectations. Search revenue increased 12% to about $63 billion, compared with analysts’ estimates of roughly $65 billion, according to Yahoo Finance.
AI spending pushes free cash flow into loss
Alphabet’s free cash flow turned negative, recording a loss of about $9 billion. Free cash flow is the money a company has left after paying its operating costs and investments, including spending on data centres. The negative figure showed that Alphabet was spending more cash than it generated, as its investments in AI increased.
Alphabet’s investments in AI companies also added to the financial pressure. The company is spending heavily to develop AI technology and expand its infrastructure, raising concerns among investors about whether these investments will generate enough returns.
Some investors fear that AI could weaken Google’s traditional search business, which has long been a major source of revenue for Alphabet. Jeffrey Wlodarczak, CEO of Pivotal Research, said bearish investors could argue that the latest quarter was the first sign that AI was starting to seriously hurt Google’s search business, according to Yahoo Finance.
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Analysts divided over Alphabet stock outlook
Not all analysts viewed the share price decline negatively. Angelo Zino of CFRA told Yahoo Finance that the pullback in Alphabet shares probably represented a buying opportunity, suggesting that the stock’s fall could attract investors who believe in the company’s long-term prospects.
Big losses in US stocks become more common
One-day losses of this size were once rare in the US stock market. However, US-listed companies lost $200 billion or more in market value in a single trading session 18 times in 2026 through Wednesday. This compared with 13 such instances in all of 2025 and none before 2022, according to Yahoo Finance’s calculations based on Bloomberg data.
The latest fall added to Alphabet’s losses over recent months. The company’s market value has dropped by about $1.4 trillion since its record high in May.
Amazon earnings in focus after Alphabet fall
Investors are now looking to Amazon’s quarterly results, due after Thursday’s market close. Amazon is the last of the three major cloud service providers to report earnings this week, following Alphabet and Microsoft.
If Amazon Web Services reports faster revenue growth without a decline in cash flow, investors may see Alphabet’s weak performance as a problem specific to Google’s search business. Strong cloud growth alongside healthy cash flow at Amazon would suggest that heavy AI investment is not necessarily hurting every major technology company in the same way, according to the analysis in Yahoo Finance’s report.
If Amazon also reports another quarter of heavy cash spending, investors could become more worried about the returns from AI investments across the technology sector. This could put further pressure on shares of companies that are spending heavily on AI infrastructure without generating enough cash to cover those investments.
