Alphabet erased $766 billion in market value in October, its worst monthly loss on record, as a 12.6% post-earnings plunge on Oct 29 pushed its price to earnings ratio to the lowest level since 2012. This week’s selloff alone wiped out as much as $477 billion—more than SpaceX, Intel, Nvidia and Amazon lost combined and the steepest single day percentage drop since Alphabet’s 2004 initial public offering—even as retail traders on Robinhood logged record one day net purchases of the stock.
The rout followed third quarter results where total revenue of $127.58 billion and earnings of $2.12 a share missed consensus estimates of $127.93 billion and $3.01. Search and Other revenue grew 12% to $63.35 billion, falling short of the $64.85 billion forecast and dropping below 50% of total revenue for the first time even as query growth reached a five year high. Chief Business Officer Philipp Schindler said rapid growth in AI Mode queries weighed on results “because of the lower monetization we were seeing in AI mode.”
Capital expenditures jumped 114% from a year earlier to $51.36 billion, outrunning $42.3 billion in operating cash flow and leaving free cash flow at negative $9.1 billion for a second consecutive quarter, a reversal from a $24.6 billion quarterly surplus in the first quarter of 2025. Management kept its 2026 capital spending forecast at $195 billion to $205 billion and projected a further increase in 2027. Google Cloud revenue rose 103% to $30.71 billion and operating income tripled to $11.1 billion, though net income was dragged down by $8.2 billion in net other expenses tied to an unrealized loss on Alphabet’s SpaceX stake.