AI Revolution: Why Alphabet Shares Plummeted Over Apple's Revelations

Anton Kirichenko -

Recently, the tech world was abuzz as Apple executive Eddy Cue took the stand in the U.S. antitrust trial against Alphabet, the parent company of Google. His revelation—that the volume of Google searches on Apple’s Safari browser had dipped for the first time in over two decades—sent a tremor through the stock market, causing Alphabet shares to tumble.

The Trial that Sent Shockwaves

Alphabet’s stock demonstrated its vulnerability when Cue revealed that AI-powered tools were siphoning users away from traditional search engines. Alphabet’s shares plunged nearly 9% during intraday trading before recuperating slightly, closing the day about 6% down. According to The Economic Times, this unexpected testimony highlighted real-time changes in user behavior, one that hints at a future dominated by AI chatbots.

The Challengers to Google’s Throne

Once the uncontested leader in online searching, Google Search is now facing formidable adversaries—AI chatbots such as ChatGPT. As Cue pointed out, users increasingly prefer these tools to find quick, precise answers, causing a stir among investors. Statistics paint a picture of a shifting landscape: while Google maintains a hefty market share, AI chatbots are slowly chipping away at its dominance.

The Search Landscape: Reality Check

Despite Cue’s alarming statement about Safari searches, Google asserts a broader picture of growth. Google claims its total query count continues to rise, including those from Apple devices. This growth, however, is increasingly coming through platforms like the Google app and Chrome, rather than Safari, illustrating the adaptability in user habits. Meanwhile, Microsoft’s Bing, leveraging OpenAI’s models, is experiencing a slight uptick, a signal that competition is heating up.

Social Media’s Growing Influence

Beyond AI tools, social media platforms are carving out a niche in the search domain, especially among younger generations. Recent studies indicate that Gen Z often turns to TikTok or Instagram for recommendations on locations, dining, and products—a concerning trend for traditional search engines like Google.

The Financial Implications for Google

Even amid these shifts, Google Search revenues grew 7% in early 2025, albeit slower than the past year’s rate. Questions linger about the impact of AI Overviews—brief, automatic answers that might limit ad revenues by reducing click-through rates (CTR). Reports suggest CTRs have dipped by as much as 35% for these AI-driven results, introducing new hurdles for Alphabet’s advertising strategies.

Alphabet stands at a crossroads in an industry facing a fundamental transformation. While it remains a leader across multiple domains, the urgency signaled by Eddy Cue’s comments can’t be ignored. As AI continues to redefine how we access information, Alphabet’s strategic adaptations will decide how it fares in the years to come.

FAQ

Q1. Is AI replacing Google Search?
AI chatbots are gradually modifying the search landscape, offering quick-answer solutions that attract a substantial audience.

Q2. Why did Google Search volume drop on Safari?
Eddy Cue noted a shift to AI tools, which appeal more to users’ current search preferences, bypassing traditional browsers like Safari.