Alphabet shares fell about 10% in after-hours trading on October 28, despite third-quarter revenue up 25% to $127.6 billion and Google Cloud revenue more than doubling. Earnings per share fell to $2.12 from $2.87, and free cash flow was negative for a second straight quarter as capital spending rose to $51.4 billion. The author argues the EPS decline looks worse than it is: excluding investment gains and losses, EPS rose about 22% to about $2.67, and Google Cloud revenue grew 103% to $30.7 billion. However, the operating margin fell to 31.8%, and the 2026 capex outlook of $195 billion to $205 billion points to continued heavy spending. The author says the stock at about 19 times expected 2027 earnings looks reasonably priced, though free cash flow may worsen before it improves.
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GOOGLearningscloud computingvaluation
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Related tickers and likely impact
GOOGL
▼ Likely negativeAlphabet Inc. (Class A)
Relevance: medium
| Market | US stocks |
|---|---|
| Sector | Communication Services |
| Industry | Interactive Media & Services |
| Market cap | $4.0T |
| Close on 10/29/2026 | 283.75 |
| Change that session | -12.66% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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