Alphabet Shares Slide After Apple Testimony Reveals Google Search Traffic Decline

Shares in Alphabet, the parent company of Google, fell more than seven percent on Wednesday following courtroom testimony suggesting Google’s search traffic on Apple devices has recently declined, with some users opting for AI-powered alternatives like ChatGPT and Perplexity.

The bombshell came from Eddy Cue, Apple’s senior vice president of services, who was speaking at a federal antitrust trial in Washington. Cue reportedly told the court that this drop in traffic—something he claimed hadn’t happened in two decades—was evidence of shifting user behaviour towards AI-driven search tools, according to media reports including MLex.

Cue’s remarks contributed to Alphabet’s market value plummeting by $140 billion, as investors reacted to concerns over Google’s search dominance facing real threats from emerging technologies.

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The trial, overseen by US District Judge Amit Mehta, will determine how Google must respond to a previous ruling that declared the company was running an illegal monopoly in online search.

Alphabet Shares Slide After Apple Testimony Reveals Google Search Traffic Decline

One of the revelations in the ongoing proceedings is that Google pays Apple tens of billions of dollars each year to remain the default search engine on the Safari browser—a practice the US government argues has entrenched Google’s dominance unfairly.

Adding to investor unease, Cue hinted that Apple plans to introduce more AI-based search options within Safari over the next year, suggesting rising competition for Google. “Those products are getting better and better,” Cue reportedly said.

Google, meanwhile, has argued that the rise of AI represents a fundamental shift in how people access information online, positioning itself as now being challenged rather than dominant.

However, US government lawyers maintain that AI will only deepen Google’s control unless strict remedies are enforced. Among the proposals is forcing Google to sell its Chrome browser or banning its lucrative default-placement deals with partners like Apple.

Cue warned that losing Google’s payments could significantly affect Apple’s investment capabilities for future innovations.

A final ruling from Judge Mehta is expected in August.

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