Alphabet shares took a heavy hit in Thursday's after-hours trading following the release of its third-quarter earnings report, with GOOGL dropping more than 10%.
If this trend carries over into regular trading hours, it would mark the worst single-day decline for Alphabet's Class A shares in 79 months, since the first wave of the COVID-19 pandemic in March 2020.
The core pressure stems from massive losses in the "Other Bets" segment. This segment includes Waymo, the Wing autonomous drone delivery system, and biotechnology company Verily. While revenue grew from $344 million last year to $372 million, the quarterly loss widened from $1.42 billion a year ago to $2.04 billion.
On the whole, Alphabet reported third-quarter revenue of approximately $127.58 billion, falling short of analysts' expectations of $128.2 billion. Earnings per share came in at $2.12, also missing the market consensus of $3.02, even though revenue still grew 25% year-over-year.
Despite the financial pressure, CEO Sundar Pichai gave high praise to Waymo's progress, noting that it has completed over 300 million miles of fully autonomous driving and operates in 15 U.S. cities including Tampa, San Diego, and San Antonio, with plans to expand into Canada, Germany, Singapore, and Spain.
On the competitive front, Tesla's Elon Musk responded on Tuesday to Florida Republican Governor Ron DeSantis's call, stating that he would expand Robotaxi service coverage to the waterfront areas of Miami and Tampa. Notably, Waymo's service areas in Tampa and Miami also cover waterfront customers, and its coverage is broader than Tesla's.
This marks the latest instance of leading tech giants squaring off directly in key markets as autonomous driving commercialization accelerates.
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