Google Stock Plunges 9% As Alphabet Faces AI Disruption and DoJ Blowback
After Apple alluded to abandoning Google Search in Safari, Alphabet's stock fell sharply, escalating regulatory concerns and igniting...
Quick overview
- Alphabet's stock dropped by 10%, losing over $200 billion in market value after Apple hinted at moving away from Google Search in Safari.
- The U.S. Department of Justice is intensifying its antitrust case against Alphabet, aiming to dismantle Google's advertising dominance.
- Apple's potential shift to AI-powered search alternatives raises concerns about Google's future profitability and market position.
- Investors are increasingly cautious as Alphabet faces significant regulatory pressures and technological disruptions.
After Apple alluded to abandoning Google Search in Safari, Alphabet’s stock fell sharply, escalating regulatory concerns and igniting concerns about the company’s fundamental operations.
Apple’s AI Ambitions Shake Google’s Dominance
Alphabet’s stock plunged by 10% today, shedding over $200 billion in market value, after Apple’s head of services, Eddy Cue, testified that the company is seriously considering switching from Google Search to AI-powered alternatives like Perplexity in future versions of Safari.
The revelation came during Alphabet’s ongoing antitrust trial, where the U.S. Department of Justice is intensifying its push to break up Google’s advertising dominance.
This development has sent shockwaves through the market, raising significant concerns over Google’s long-standing dominance in internet search. Investors are worried that if Apple ends its partnership with Google—which is estimated to be worth $20 billion annually—it could substantially erode Google’s search ad revenue base.
Regulatory Pressure Mounts
In parallel, the DOJ is aggressively pursuing its antitrust case against Alphabet, seeking to force the divestiture of key ad tech assets such as Google’s AdX exchange. These moves aim to dismantle what the government claims is Google’s monopoly over digital advertising and search.
Apple’s comments, ironically delivered in Google’s defense, have deepened skepticism about Google’s competitive future. The suggestion that Safari may pivot to AI competitors adds another layer of risk to a business already under siege from both regulators and disruptive technologies.
Stock Price Fallout and Future Risks
Alphabet shares opened at $165 but quickly plunged below $148, briefly trading around $150—a one-day loss of nearly 9% to 10%. The impact on the company’s market cap has been brutal, with over $200 billion wiped out in a matter of hours.
Google Stock Chart Daily – Heading to April Lows
Although Alphabet reported solid Q1 earnings, today’s revelations raise red flags for the outlook in Q2 and beyond. If Apple follows through on replacing Google Search with an AI alternative and regulatory actions continue to tighten, Google’s profitability could be seriously compromised in the second half of 2025.
Conclusion: Will We See the Bear Trend Resume for GOOG?
What was once seen as an untouchable giant in search and advertising now faces the twin threats of technological disruption and regulatory dismantling. Investors are right to be cautious, as Alphabet’s business model could be undergoing a fundamental shift—one that the stock market is beginning to price in with force.
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