GoKawiilAlphabet shares sink 10% premarket after weak free cash flow in Q3 earnings
Alphabet stock dropped about 10% in premarket trading Thursday, which would mark its worst post-earnings decline since going public in 2004 if it closes down more than 9.77%. The company posted negative free cash flow of $9.07 billion for the third quarter, far worse than the $2.70 billion shortfall analysts had expected, while keeping its full-year capital expenditure guidance at $195-205 billion. Microsoft, by contrast, rose nearly 4% after reporting $45.2 billion in capital spending, below analyst estimates, and free cash flow that fell 27% but stayed positive.
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The contrasting reactions suggest investors are growing more selective about how AI infrastructure spending is funded and disclosed, rewarding Microsoft's steadier approach while punishing Alphabet's larger cash burn. Analyst Ben Barringer of Quilter Cheviot attributed Alphabet's drop partly to a 'poorly handled earnings call,' indicating communication, not just numbers, may have shaped the market response. The move could signal heightened scrutiny of big tech's AI capex plans heading into future earnings reports.
- Alphabet shares fell about 10% premarket, potentially its worst post-earnings drop since its 2004 IPO.
- Alphabet posted negative free cash flow of $9.07 billion, far below analyst expectations of a $2.70 billion shortfall.
- Microsoft shares rose nearly 4% despite lower capex than forecast and a 27% drop in free cash flow, which stayed positive.
Source: cnbc.com — Arjun Kharpal, 2026-10-29
Published there as: “Alphabet falls 10% in premarket, putting it on course for its biggest ever post-earnings drop”
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