GOOG Stock Fell 5% as Google Spent $205B on AI but Gemini Is Late and Anthropic Chose AMD

• GOOG stock fell 5% after the Google earnings report beat with $119.8B revenue and Google Cloud revenue up 82% to $24.77B, while investors questioned Google’s $205B AI investment as Anthropic chose AMD over Google for its AI chip deal
• Gemini 3.5 Pro missed its third launch deadline as Bloomberg cited 10 employees warning Google risks losing its AI edge to OpenAI and Anthropic
• Google’s $9.11 EPS beat was driven largely by $99B in unrealized gains as Anthropic signed a multi-billion-dollar AMD chip deal instead of using Google’s TPUs

Google’s latest earnings report appeared much stronger on paper than it actually was stronger on paper than it was beneath the surface. Despite the robustness of the report, GOOG stock volatility is the latest topic of contention among investors. Google’s stock fell 5% after hours as investors are now questioning Alphabet’s aggressive AI spending and strategy. Alphabet reported nearly $119.8B in revenue, with Google Cloud revenue reporting nearly $24.77, up 82% in a year. Despite such a strong earnings report, investors are focusing on Google’s $205B AI investment commitment. That led GOOG stock to witness sharp volatility in after-hours trading. Google is also under pressure due to repeated Gemini 3.5 launch delays. At the same time, competition from Anthropic and OpenAI continues to intensify.

Gemini 3.5 has now missed three launch deadlines after initially being expected to launch in June. Bloomberg, citing interviews with 10 former and current Google employees, reported that the company risks losing its edge. OpenAI launched GPT-5.6 Sol, while Anthropic launched Claude Opus 4.8, which has emerged as one of the leading coding models in the space. The portal also reported that Google updated Gemini’s training data specifically to improve its coding performance. However, the results reportedly fell short of expectations.

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Google Beats Cloud and Revenue Estimates, but the Real AI Story Is Gemini’s Third Delay, Four Defections and a $205B Spending Question

Alphabet’s latest Q2 earnings report exceeded Wall Street’s expectations, reporting a stellar $119.8B in quarterly revenue. Driven by booming cloud and AI demand, Google Cloud revenue jumped 82% to $24.77B, signalling Google’s strength in the AI and cloud domain. Despite reporting such stellar results, GOOG stock tumbled 5% after hours. Investors continued to question the company’s decision to ramp up its capex, committing nearly $205B to Google AI investments.

The latest GOOG stock decline signals more than just a shakeup. It also reflects investors’ growing wariness towards organisations willing to spend heavily on AI infrastructure. The market is still divided over rising AI expenditure and whether companies are making the right decisions to stay ahead in the rapidly growing AI race.

Gemini Delays and the Anthropic AMD Deal Raise New Questions

The latest GOOG stock fall is symbolic in many ways. The cutting-edge competition in the AI sector, with the Anthropic-AMD deal stealing the spotlight, is another significant development weighing heavily on investors. Despite multiple deadlines, Google’s Gemini 3.5 model is yet to launch. Meanwhile, the Anthropic-AMD deal is already finalised. The timing plays a significant role here. On the same day, Anthropic signed a tens-of-billions-of-dollars AI infrastructure deal with AMD. This includes AMD investing up to $5B in the startup to supply the next-gen Instinct MI450 chips. It also puts Google in an unusual position as it owns a 14% stake in Anthropic. In addition, Bloomberg reported that four prominent AI researchers have left Google for Anthropic, adding to concerns that the company is struggling to retain top talent as competition in the AI race intensifies.

More importantly, Gemini 3.5 has missed three launch deadlines, as Bloomberg reported after interviewing 10 former and current Google employees, hinting at Google losing its AI edge. The core reason for this delay is Gemini 3.5’s coding corrections. Google internally retrained Gemini to improve its coding capabilities. But the effort reportedly failed to deliver expected results. Such delays have raised alarming signals for investors, especially when competitors like Anthropic and AMD continue to introduce rival products. 

It is not just the Gemini launch delay that hit the GOOG stock heavily. The latest innovations done by the OpenAI team by introducing new iterations of its AI model are also increasing pressure on Google’s AI pathway. 

Google’s earnings beat has also raised a few questions. Alphabet reported earnings per share of $9.11, but much of the gain came from unrealized gains tied to its investments in Anthropic and SpaceX. Stripping out those gains, adjusted EPS of $2.85 missed the $2.89 Wall Street consensus. The miss has added to investor concerns over GOOG stock, with many questioning whether Google’s heavy AI spending is producing meaningful operating results.

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