Alphabet Inc., the parent company of Google, experienced a substantial decline in its stock value on Wednesday, resulting in the fifth-largest one-day loss in market value for any U.S. company to date.
The company’s shares, traded as GOOG and GOOGL, fell by 9.5% during Wednesday’s trading session. This decline caused Alphabet to lose a staggering $166.64 billion in market value, according to Dow Jones Market Data. It is the largest one-day loss ever recorded for Alphabet, surpassing similar losses experienced by Meta Platforms Inc., Amazon.com Inc., Apple Inc., and Microsoft Corp. in the past.
To put this into perspective, Alphabet’s market cap decrease is greater than the entire market capitalizations of other major companies such as Nike Inc., Advanced Micro Devices Inc., and Walt Disney Co.
This 9.5% drop in Alphabet’s Class A shares marks its worst single-day percentage decline since March 16, 2020, when the company experienced an 11.6% loss.
In addition, Wednesday’s decline represents the largest post-earnings one-day percentage decline for Alphabet’s Class A shares since July 18, 2008, when they fell by 9.8%, as reported by Dow Jones Market Data.
Alphabet had recently announced its quarterly earnings which exceeded overall revenue and earnings expectations. However, analysts were less optimistic about the company’s margin potential going forward due to underwhelming performance in its cloud-computing business.
Barclays analyst Ross Sandler commented on the situation, stating, “Expectations were high heading into GOOG results, and while the top-line delivered in the most important areas, we wouldn’t be surprised if investors rotate a bit into other mega-cap tech names near-term.”
It is evident that the market’s reaction to Alphabet’s earnings report has sparked concerns among investors, leading to the significant decline in its stock value.
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