Google stock's historically bad day raises fears of AI bubble popping

On October 29, 2026, Google's parent company Alphabet saw its stock price plummet by up to 15.8%, resulting in a one-day market value loss of over $500 billion, the worst ever for the company. This drop was largely due to concerns about artificial intelligence (AI) investments not yielding returns quickly enough and fears that AI chatbots might be eating into Google's traditional search business. Despite executives touting more than 1 billion users of its Gemini AI app and promising "promising results" from ad experiments, the market reacted negatively to missed revenue targets and negative cash flow for the second consecutive quarter. This event also affected broader markets, with tech-heavy indexes like the Nasdaq dropping significantly amid a wider reassessment of US economic growth and sustainability in rapid AI spending by major tech companies.