Alphabet's $11 billion SpaceX stake loss drags down Q3 profit despite strong growth

Alphabet reported a $11 billion accounting loss from its SpaceX investment in Q3, dragging net income down 25% to $26.17 billion despite strong operational growth. The loss stemmed from a decline in SpaceX share value, not a sale. The mark-to-market adjustment reduced Alphabet's equity securities by $8.66 billion, contributing to earnings per share of $2.12, below Wall Street's $3.02 forecast. Revenue rose 25% to $127.6 billion, with Google Cloud sales doubling, while operating profit climbed 30%. Alphabet's heavy AI spending, including $51.4 billion in capital projects, pushed free cash flow negative at $9.07 billion. Management expects 2026 capex between $195 billion and $205 billion, and shares fell 10% in extended trading.