Alphabet Shares Plunge 13% in Worst Day as AI Costs and Weak Ad Revenue Spark Sell-Off

Alphabet shares plunged nearly 13 percent in a single trading session, the worst single-day drop in company history, erasing roughly half a trillion dollars in market value. The sell-off reflects investor fears over high AI spending and weak advertising revenue. Google Search revenue hit about $63 billion, missing analyst expectations of $65 billion, while Alphabet posted negative free cash flow of $9 billion due to heavy AI infrastructure spending. The results fueled concerns that AI investments are eroding profits without immediate returns. Google Cloud revenue more than doubled to exceed $30 billion, and Gemini AI passed one billion users, but these bright spots failed to offset market fears. The decline also dragged down major US tech indices.