Alphabet stock plunges 13% after earnings, wiping out nearly $500 billion in market value

Alphabet, the parent company of Google, experienced a sharp 13% decline in its stock price on Thursday after reporting its third-quarter earnings. This dramatic drop wiped out nearly $500 billion in market value, making it the second-largest single-day loss in US-listed company history, surpassed only by Nvidia's $593 billion loss earlier in January.

The drop came as investor concerns about the future of AI technology heightened, particularly with the emergence of China's DeepSeek AI model. Alphabet's stock would need to close at around $274.75 to match Nvidia's record loss, according to calculations by Yahoo Finance. The company's strong cloud business, with Google Cloud revenue doubling to $31 billion, and its AI app Gemini reaching 1 billion users, failed to prevent the significant stock decline.

However, Google's search business underperformed Wall Street expectations, with revenue increasing by 12% to $63 billion. Negative cash flow, amounting to a loss of $9 billion, highlighted Alphabet's heavy investments in AI, which raised investor concerns. While some analysts view the stock drop as a potential buying opportunity, the recent losses have pushed Alphabet's market value down by about $1.4 trillion since May, signaling potential trouble ahead for companies heavily investing in AI infrastructure.