Alphabet misses estimates as AI spending weighs; stock sinks 10%

· Tech · United States

Alphabet reported third-quarter sales and profit below Wall Street expectations, its first top-and-bottom-line miss in nearly four years, and its shares fell 10% in late trading. The company held its 2026 capital spending plan unchanged and said it expects a significant increase in 2027, renewing investor concerns about the returns on massive AI investments. YouTube ad revenue also fell short of analyst estimates, though the number of music and premium subscribers crossed 150 million. The disappointing results pulled US stock-index futures lower in early Asian trading, compounding worries after the Federal Reserve held rates steady.

Why it matters：Alphabet's miss is a test of whether the AI investment boom can justify its cost, a question now weighing on markets well beyond Silicon Valley.

Key points

  • It was the company's first revenue and earnings miss in nearly four years.
  • 2026 capital spending stays flat, with a 'significant increase' expected in 2027.
  • YouTube ad revenue missed estimates even as premium subscribers topped 150 million.

Sources (original reporting)

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