TLDR
- Alphabet (GOOGL) stock fell nearly 13% on Thursday, its worst day since going public in 2004.
- The company lost about $482 billion in market value, the second-biggest one-day loss ever for a US-listed company.
- Search revenue grew 12% to about $63 billion, short of the roughly $65 billion Wall Street expected.
- Google Cloud revenue more than doubled to about $31 billion, but free cash flow swung to a loss of about $9 billion.
- The drop pushed the stock into a “death cross,” and Amazon (AMZN) also fell after hours on heavy AI spending.
Alphabet (GOOGL) stock fell nearly 13% on Thursday after its third quarter results, its worst day since the company went public in 2004. The drop topped the steep falls of March 2020 and September 2008.
The slide wiped out about $482 billion in market value. That is the second-biggest one-day loss ever for a US-listed company, behind only Nvidia (NVDA), which lost about $593 billion on Jan. 27, 2025.
It also beat the $400 billion that SpaceX (SPCX) lost on June 22, the previous No. 2. In dollar terms, Alphabet’s prior worst day was about $275 billion on July 23.
BREAKING: Alphabet stock, $GOOGL, falls over -13% after posting weaker than expected earnings, now on track for its biggest post-earnings drop on record.
The stock has now erased -$520 billion in market cap today. pic.twitter.com/J3vBgQJuEA
— The Kobeissi Letter (@KobeissiLetter) October 29, 2026
It was also the stock’s steepest drop after an earnings report. The previous low was a slide of nearly 10% in July 2008, according to Bespoke Investment Group.
What Missed the Mark
Search revenue grew 12% to about $63 billion, short of the roughly $65 billion analysts expected. Growth in that business was 17% in the second quarter and 19% in the first.
Google Services, which includes search ads, YouTube and subscriptions, brought in $96.3 billion. Wall Street had expected $98.5 billion.
Operating expenses came in higher than expected. Free cash flow turned negative, a loss of about $9 billion, as AI spending climbed.
Not everything was weak. Google Cloud revenue more than doubled to about $31 billion, and the Gemini app passed 1 billion users.
Philipp Schindler, Google’s chief business officer, said fast growth in “AI Mode” queries is having an effect. Those queries earn less money than traditional search, even as overall queries grew at their fastest pace in five years.
Schindler also pointed to currency moves, lower revenue from Asian retailers tied to EU rules, and ad spending pulled into the first half by the World Cup.
What Analysts Are Saying
“The bears will argue this is the first quarter that AI is starting to seriously hurt their search business,” said Jeffrey Wlodarczak, CEO of Pivotal Research. CFRA’s Angelo Zino was calmer, saying the pullback “probably represents a buying opportunity.”
Mike O’Rourke of JonesTrading said Google showed vulnerability to AI despite spending heavily to protect its core business. “That’s why people are disappointed,” he said.
The fall was steep enough to complete a death cross, where the 50-day moving average drops below the 200-day. Some analysts see that as a sign the price has further to fall.
Rivals are also in the picture. OpenAI said it was on track for $1 billion in annualized ad revenue, with ads now available in 89 countries. Ad buyers say most of that money is test budget, not a shift away from Google.
NewStreet Research said Alphabet faces headwinds until it rebuilds faith in search and AI monetization. The firm estimates that could take until the first half of 2027.
Alphabet has now lost about $1.4 trillion in value since its record high in May. US-listed stocks have shed $200 billion or more in a single session 18 times this year through Wednesday.
After Thursday’s close, Amazon reported Amazon Web Services growth of 39%, its fastest in nearly five years. Its 12-month free cash flow fell to a record outflow of more than $42 billion, and its stock dropped in after-hours trading.
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