Alphabet drops 10% after revenue miss and $9.1 billion cash burn
What's new: Google Cloud topped estimates, but weak ad sales and heavier AI spending erased nearly $400 billion in market value.
Alphabet shares fell about 10% in after-hours and premarket trading after the Google parent missed Wall Street's third-quarter revenue and profit targets and posted negative free cash flow of $9.07 billion. Revenue came in at $127.6 billion, below the $128.2 billion analysts expected, while adjusted earnings per share of $2.67 missed forecasts of $3.02. The shortfall was driven by advertising, with Google ad revenue at $82.01 billion, about $1.41 billion below estimates. The company said AI-related spending pushed cash burn deeper and will drive a significant increase in capital expenditures in 2027, even as its 2026 forecast stays unchanged. Google Cloud revenue more than doubled to $30.71 billion and beat estimates, but that was not enough to offset concerns about pressure on the core search business.