Alphabet shares plunge 12% as Google's AI spending spooks investors

Google suffered its largest market crash ever, with Alphabet shares falling over 12 percent and wiping out $500 billion in market value. The historic decline followed the tech giant's first negative free cash flow in 22 years. Alphabet reported negative free cash flow of $9.1 billion due to heavy AI investment, while third-quarter revenue reached $127.6 billion, missing Wall Street targets as search advertising growth slowed. Google Cloud revenue more than doubled to $30.71 billion, partially offsetting advertising shortfalls. Investors remain concerned about vast capital expenditure on AI infrastructure and whether search integration will generate sufficient profit. The company's financial results signal growing pressure to justify its massive AI spending.