Alphabet loses $500 billion in a day as AI spending bites

Alphabet’s shares had their worst day since its 2004 listing after it spent more cash than it made for a second quarter running.

By Alexandre S. 31 Oct 2026, 00:45 UTC

Alphabet’s shares fell about 12 per cent on Thursday 29 October 2026, wiping roughly $500 billion off its market value in its worst trading day since it listed in 2004, TechCrunch reports. Investors had two worries, cash and search. Data centres and chips cost Alphabet $51.4 billion in the third quarter alone, which left it $9.1 billion short of the cash its business brought in. That makes two quarters in a row of spending more than it made. And the bill keeps rising: Alphabet puts this year’s capital spending at up to $205 billion, with more planned for 2027.

Search added to the worry. Growth in Google’s search revenue slowed from 19 per cent in the first quarter to 12 per cent in the third, and Philipp Schindler, Google’s chief business officer, tied part of that to AI Mode earning less per query, AdExchanger notes. We covered that remark yesterday. Between them, Alphabet, Amazon, Meta and Microsoft plan more than $740 billion of capital spending this year. That worry spread on Friday, when Alphabet’s shares fell for a second day and the Nasdaq lost 2.9 per cent.

Advertisers buy that compute by the clip. On Google AI Pro, at $19.99 for 1,000 Flow credits, a Veo 3.1 Fast video costs 20 credits, or $0.40, our 30 October check records. Our daily price watch, running since 12 August, has logged no change to any Google tool.

So far the cash squeeze shows up in Alphabet’s accounts and leaves Google’s creative prices where they were: a 20-clip Veo Fast hook batch costs about $8 on AI Pro.

Alphabet loses $500 billion in a day as AI spending bites

Sources

More AI news from 31 October 2026