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Huge sell off at Google: Tech giant loses value of Disney overnight

The Google logo is photographed at the Vivatech show in Paris, Thursday, June 15, 2023.
The Google logo is photographed at the Vivatech show in Paris, Thursday, June 15, 2023. Copyright Michel Euler/Copyright 2023 The AP. All rights reserved.
Copyright Michel Euler/Copyright 2023 The AP. All rights reserved.
By Doloresz Katanich with Reuters
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Shares in Google's parent company Alphabet lost almost 10% after the company published its earnings report.

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A huge selloff in Alphabet Inc. shares on Wednesday wiped out more than $166 billion (€157 billion) in the company's market value, according to Dow Jones Market Data.

This means that Alphabet, Google's parent company, lost more than the entire market capitalisations of Nike ($157.58 billion) or Disney ($147.46 billion) in valuation overnight, according to Marketwatch. 

That also makes it the fifth-largest one-day decline in market value for any US company on record.

Alphabet shares lost 9.5% after the company reported good numbers, mainly beating expectations from its previous quarter, with the exception of its future money-making cloud computing profit which was far from expected. The operating income results showed $266 million, following estimates of $434 million.

The numbers suggest that the growth of Alphabet's cloud unit fell to near a three-year low, which was particularly paling in comparison to Microsoft's relative success as the tech giants race to make money from generative artificial intelligence.

Growth at Alphabet's cloud unit was dampened by its big exposure to smaller clients.

"The firm is more exposed to high-growth and startup clients, which have been more aggressive with cost-control efforts," Morningstar analyst Ali Mogharabi said.

The share losses suggest investors are concerned that Alphabet's focus on startups and slower roll-out of AI services delayed the earnings boost from the new technology.

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