A Hard Blow for Investors: Why Did Google's Stock Drop 10% in One Day?

Alphabet, Google's parent company, saw its stock plunge over 10% in after-hours trading following disappointing quarterly earnings. While revenues rose, net profit plummeted 25%, missing analyst forecasts, primarily due to a slowdown in advertising growth and massive spending on artificial intelligence.

Alphabet, the parent company of Google, saw its stock plunge more than 10% in after-hours trading after releasing its third-quarter financial results. Total revenues increased, but the company missed analysts' profit forecasts. The slowdown in advertising, its main growth engine, is the primary concern: advertising revenue grew 11% to $82 billion, below expectations, and search revenue growth slowed to 12% from 17% in the previous quarter. Net profit plummeted 25% to $26.2 billion, and the company recorded an $8.7 billion loss from equity investments, primarily in its stake in SpaceX. Meanwhile, capital expenditures on artificial intelligence more than doubled to $51.4 billion, while the cloud division surged 103% to $30.7 billion.