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Google Cloud just doubled its sales in a single year. Investors responded by dumping Alphabet Inc. (NASDAQ:GOOGL) at a pace not seen since its 2004 listing.

Class A shares fell 12.9% to $282.94 in early trading Thursday. The drop erased about $511 billion of market value, the second-largest one-day loss ever for a U.S.-listed company. Only Nvidia Corp. (NASDAQ:NVDA) has lost more, shedding about $593 billion on Jan. 27, 2025, when the launch of China’s DeepSeek rattled AI investors.

For Alphabet itself, it is the worst session on record. The previous worst came on March 16, 2020, when the stock lost 11.6% during the pandemic crash.

Third-quarter earnings per share came in at $2.12, well below the $3.02 consensus. Revenue of $127.6 billion also missed the $128.2 billion estimate, even as Google Cloud revenue jumped 103% to $30.7 billion.

The problem is the bill. Capital spending more than doubled to $51.4 billion, which pushed free cash flow to negative $9.1 billion for a second straight quarter. As a result, Alphabet bought back no stock. Instead, it raised cash through debt and new shares. Chief Financial Officer Anat Ashkenazi said spending should rise significantly again in 2027.

The State Street Communication Services Select Sector SPDR ETF (NYSE:XLC), which counts Alphabet among its largest holdings, fell 2.2%.

Chart: Alphabet Class A daily price change since 2004. Source: TradingView

Image: Envato Elements