Alphabet shares fell 12.6% last Thursday, wiping $505 billion off its market cap in one session, and are now down 30.5% from their all-time high. Third-quarter revenue rose 25% to $128 billion, but capital expenditures jumped 114% to $51.36 billion, turning free cash flow negative at $9.07 billion. Alphabet expects 2026 capex of $195 billion to $205 billion, long-term debt rose to $125.5 billion, and it made no buybacks year-to-date through Sept. 30, 2026, while issuing shares for $12.4 billion in net proceeds. The article notes part of Google Cloud's growth came from one-time TPU chip sales, and Search revenue rose 12%, slower than the 14.5% growth of a year earlier. The author argues the market misunderstands Alphabet and says he holds a strongly positive view of the company.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
GOOGLearningsAI investmentshare buybacks
Open a keyword to see other news on the same topic.
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 | $3.5T |
| Close on 10/30/2026 | 279.76 |
| Change that session | -1.43% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- Alphabet Swaps Buybacks for Data Centers. Wall Street Is Getting Nervous
Alphabet is shifting spending from share buybacks to data centers, and Wall Street is growing nervous. Investors will be looking at Google Cloud's AI spending and returns for reassurance.
- This Magnificent Seven Stock Could Have 100% Upside. Here’s the Case.
Alphabet (GOOG) has a 12-month price target of $423.95 and a five-year base case of $710.20 by October 2031, a total return of 121.41%, and the article rates the stock a buy with moderately high confidence. Shares traded around $318.28 early Friday, down 7.72% for the week and 8.38% for the month but up 26.37% over 12 months. Second-quarter revenue rose 24.2% to $119.80 billion, while Cloud segment revenue reached $24.77 billion and its operating margin expanded to 35.6% from 20.7%. On the other side, capex doubled to $44.92 billion, free cash flow turned negative at $5.86 billion, long-term debt rose from $46.5 billion to $98.2 billion, and buybacks were suspended. The bear case is $365.73.
- Alphabet Stock Falls After Earnings as Google Swaps Buybacks for Data Centers
Alphabet, the parent company of Google, reported weaker-than-expected earnings and revenue as it reinvents itself as an artificial-intelligence cloud provider. The headline also says Google is shifting from share buybacks to data center investment.
- Alphabet's 2 Classes of Common Stock Trade About 1% Apart. Here's the One I'd Buy.
Alphabet's Class A shares (GOOGL) trade about 1% above Class C shares (GOOG), roughly $335 versus $331 at the time of writing. Only Class A carries a vote; Class B shares, which carry 10 votes each and don't trade publicly, are held mainly by co-founders Larry Page and Sergey Brin, who had around 53% of voting power as of April 6. All classes otherwise share the same 22-cent quarterly dividend and claim on net income. Alphabet bought far more Class C stock than Class A from 2023 through 2025 and made no buybacks in the first half of 2026, while the Class A premium has stayed near 1% since September. The author sees the vote as nearly symbolic given the founders' majority, so Class C offers the same business at a slightly lower valuation; for a $10,000 investment, it buys about a third of a share more, roughly $114 of extra stock. The gap has held within around 2% since 2022 and may narrow if buybacks resume.
- Alphabet Missed Its Q3 Estimates, and I Couldn't Care Less
Alphabet's Q3 revenue rose 25% to $127.6 billion, but EPS fell 26% to $2.12 from $2.87, both missing consensus estimates of $128.2 billion and $3.02. Free cash flow turned negative at about $9.1 billion as capital expenditures rose to $51.4 billion from $44.9 billion in Q2, largely for AI infrastructure. Search advertising grew 12% to $63.5 billion, below the $64.9 billion expected and slowing from nearly 17% in Q2, while Google Cloud revenue soared more than 100% to $30.7 billion with operating income of $11.1 billion. The author argues the picture needs context: net income included an $8.2 billion unrealized loss on Alphabet's SpaceX stake, operating income rose 30% to $40.6 billion, and cloud backlog grew to $567.7 billion from $519.5 billion at mid-year, mostly AI-related. The author says capex is in line with the $195–205 billion full-year budget and that the results were, on balance, more good than bad.
- GOOGL Gains Premarket As Tech Selloff Eases: Alphabet Preps Second Euro Bond This Year
Alphabet rose 1% in premarket trading on Monday as tech stocks recovered from a brutal week and disappointing third-quarter results. Bloomberg reported the company plans its second euro bond sale this year to fund AI infrastructure, a seven-part deal with maturities of two to 19 years, with the 19-year notes offered at about 205 to 210 basis points over mid-swaps. Google Search & other revenue grew 12% to $63.3 billion, slowing from 17% in the prior quarter, while capital expenditure reached $51.36 billion and 2027 spending is expected to be higher than this year. Cloud unit sales doubled, but surging AI-related cash burn weighed on the results. Year to date, GOOGL is down 10.4%.
Related markets
Latest news
- Marvell to buy Lumentum in all-stock deal, a massive bet on AI connectivity
Marvell said it will acquire optical component maker Lumentum in an all-stock, fixed-ratio deal with an implied enterprise value of $115 billion, aiming to meet growing connectivity demand from AI infrastructure. Each Lumentum share will be exchanged for 4.5 Marvell shares, so the deal's value will move with Marvell's share price, and it is expected to close in the first half of 2028. Chairman and CEO Matt Murphy said AI infrastructure is shifting toward optical connectivity, and the acquisition lets Marvell combine electrical and optical technologies. The move follows Marvell's multibillion-dollar purchase of Celestial AI earlier this year, and comes as its market value has more than tripled over three years. Lumentum's stock has more than doubled in 2026, while Marvell shares fell 3% and Lumentum about 4% before the bell.
- Ho Chi Minh City urges businesses to announce 2027 Tết bonuses in November
The Ho Chi Minh City Federation of Labour asks grassroots unions to urge employers to publicly announce their Tết Đinh Mùi 2027 bonus plans by 30/11/2026, and to pay bonuses or partial advances from November or December 2026 where possible. Unions are also asked to monitor full and on-time wage payments, including overtime, night and holiday pay, and to request that January 2027 wages be paid early or advanced. Workers facing wage arrears, job losses, serious illness or workplace injuries will be reviewed to propose Tết support. Employers that pay wages late, have prolonged social insurance debts, or risk closure or bankruptcy must be reported immediately. Industrial park unions must submit a preliminary report by 3/12/2026 and a second-round report by 15/1/2027, and each must list 2 employers for supervision by 30/12/2026.
- NYT: President Putin thwarts Western attempts to isolate Russia
The New York Times says Russian President Vladimir Putin is defeating Western efforts to isolate him through a rapid series of diplomatic engagements in the Russian capital last week, according to Moscow bureau chief Paul Sonne. The article cites a call with Finnish President Alexander Stubb and Norwegian Prime Minister Jonas Gahr Store, visits by African leaders to Russia, and engagement with the US government as evidence. It contrasts this with weakening US–Ukraine relations, highlighting Ukraine's vulnerability ahead of what is expected to be the worst winter of the war, nearly five years into the conflict. Foreign Minister Sergey Lavrov says the West promotes the idea of “international isolation”, but Russia continues to take an active part in international forums and expand its foreign relations.
- The Midterms Are Tomorrow. Here's What History Says Defense Stocks Do in the 6 Months After a Midterm -- and the 2 I'd Buy First
The 2026 midterm elections are tomorrow, and polls and prediction markets suggest Democrats could control both the House and Senate from January 2027. The author notes that defense stocks under Democrat-controlled Congresses have historically not been as dire as the sector's recent price moves imply, though the iShares U.S. Aerospace & Defense ETF (ITA) is 18.4% below its 52-week high. During the period when Democrats held the House, Senate and presidency from 2021 through 2022, ITA gained 22.1%. Program-specific contractors could be vulnerable if spending on items such as the Golden Dome, fighter jets or tanks is delayed, while GE Aerospace and RTX have some buffer from their commercial aerospace exposure. The author argues that selling stocks based on election results is a major mistake, noting that large defense backlogs tied to readiness, rearmament and replenishment are bipartisan.
- Marvell Could Be Making a $115 Billion Mistake With Lumentum Purchase
Marvell stock fell on Monday after the company agreed to acquire Lumentum at a value of $115 billion. The article provides no further details on the deal.
- AI is breaking the search business model
In the Loop host Ejaaz Ahamadeen argues that AI is undermining the traditional search business as people increasingly ask AI chatbots instead of searching on Google. AI tools lack Google-style search ad revenue and belong to firms such as Anthropic and OpenAI, which affects companies beyond the AI sector. Reddit reported record earnings, yet its shares fell around 26% in early trading because search ad revenue drove less traffic to its site. Reddit is also starting to require account login to access content, fearing AI will replace it as AI models are trained on its data without payment.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.