Google’s fall comes weeks after Chipmaking Giant Nvidia suffered a similar fate following the release of Deepseek R1
Alphabet Inc., the parent company of Google’s stock, plummeted more than 8% on Wednesday, marking its biggest percentage decline since October 2023. The reduced cost of Google’s parent alphabet has eliminated the market value of $21.1 billion for the slide. Reportedly, the decline is the company’s biggest daily decline in value. In the midday trading, Alphabet’s shares closed at $193, falling 7.6% at $190.70.
Google’s fall comes weeks after chip-making giant Nvidia delivered similar results after the release of China’s groundbreaking AI model, the Deepseek R1.
Google’s results exceeded Wall Street’s expectations, but the company’s revenues fell, resulting in a fall in prices. Despite slowing sales growth, Tech Giant has announced plans to drive spending on AI initiatives. This coincided with that decline.
Market analysts say the stock’s sale reflects growing concern among investors about rising AI spending by major US technology companies. This concern has increased since the Chinese startup launched a powerful AI model created for less than $6 million and created without Nvidia’s top-tier hardware.
The effectiveness and necessity of critical AI spending underway by US companies such as Google, Microsoft and Openai is under scrutiny following Deepseek’s discovery.
Company revenue has been called previously. Google CEO Sundar Pichai revealed his intention to spend an incredible $75 billion on capital projects in 2025.
The report states that Google’s large investments focus primarily on enhancing AI infrastructure and capabilities. In the earnings announcement, Sundal Pichai said, “We are optimistic about future opportunities and expect to accelerate progress by investing in approximately $75 billion in capital expenditures in 2025.” .
When asked about China’s Deepseek AI, Sundar Pichai said that the team of Chinese AI models is “surprising” and produces “very good work”, but Google’s models are Deepseek’s V3 and They claimed to be part of the most efficient model, including Rone. “
As they compete with the Chinese internet giants to create cutting-edge AI models, other large US internet companies such as Google, Microsoft, Facebook Parent Meta, and Amazon have invested heavily in building AI infrastructure I’m doing it.
Regarding China’s Deepseek, in response to questions about Deepseek’s progress, regarding Sundal Pichai, Pichai said that the company staff is “surprising” and “very well” running, but Google’s model is Deepseek It was said to be some of the most efficient models, including comparing them with the models. V3 and R1. “His statement means that Google has placed a bet on the cost-effectiveness and future scalability of AI applications to protect existing investments.
