Alphabet (GOOGL) Bleeds $170B After iPhone Google Search Traffic Tanks—First Drop in History

Google’s iron grip on iPhone search just slipped—and Wall Street’s panic selling proves nobody saw it coming. The $170B nosedive makes you wonder: did Alphabet bet too big on being Apple’s default cash machine?

Search dominance was supposed to be untouchable. Now? Even the suits are sweating their ’safe’ tech stocks. Funny how one iOS update can vaporize a year of buybacks.

Why iPhone Users Shifted Away From Google Search—And What It Means

Eddy Cue, who is Apple’s senior vice president of services, stated:

The unprecedented Apple iOS search impact was revealed during an ongoing antitrust trial where Judge Mehta is currently determining remedies for Google’s previously ruled illegal search monopoly. At this point in time, Alphabet loses market value as investors are increasingly worried about AI alternatives that could potentially threaten Google’s core business.

$170 Billion Market Impact

The GOOGL stock drop has essentially wiped out approximately $170 billion in just a single trading day as investors reacted to the testimony. For many years now, Google has been paying Apple billions of dollars annually to remain the default search engine on iPhones and other Apple devices. This long-standing arrangement is now under intense scrutiny as part of the antitrust case.

Cue testified:

AI Alternatives Taking Share

Alphabet loses market value partly because iPhone users are now turning to AI-powered alternatives such as ChatGPT and Perplexity. The Google search decline on iPhone is benefiting these platforms that offer more conversational and direct answers rather than traditional link-based results.

Sundar Pichai, who is Google’s CEO, warned:

Regulatory Consequences

The GOOGL stock drop might actually worsen depending on Judge Mehta’s upcoming ruling expected in August. Government attorneys are actively pushing for Google to divest its Chrome browser, arguing that the Google search decline on iPhone isn’t really enough to prevent future monopolization.

The Apple iOS search impact could also intensify if the judge ends Google’s default agreements. Right now, Alphabet loses market value as this particular case represents just one of five major tech antitrust actions currently being pursued by the US government against large tech companies.