- Alphabet joined the Dow Industrial Average on Monday.
- The stock is tracking for its worst month since February of last year, a big change from May when it briefly eclipsed Nvidia by market cap after hours.
- Investor concerns about Alphabet are centered on AI execution, with compute shortages, lower-cost Chinese models, DeepMind talent exits and reduced buybacks raising questions about the payoff from Alphabet’s capex spend.
The move comes despite continued pressure on the stock. Even with Monday's gain, Alphabet is still tracking for its worst month since February of last year, with six of the past seven weeks in the red. That marks a sharp reversal from May, when the company briefly eclipsed
Nvidia after hours to become the world's most valuable company by market capitalization.
Alphabet's Dow inclusion is more symbolic than mechanical. The stock is already in the S&P 500 and Nasdaq 100, where most benchmarked assets sit, limiting the amount of forced fund buying tied to the index change.
Weakness in Google shares comes as investors question the payoff from the company's AI spending, with lower-cost
Chinese models improving, Google DeepMind researchers tied to Gemini and coding tools leaving for rivals like Anthropic and OpenAI, and compute access emerging as both a customer constraint and a recruiting issue.
Alphabet reportedly does not have enough compute capacity to meet demand from enterprise customers such as
Meta, and is turning to infrastructure rivals, including SpaceX, to help close the gap. Alphabet did not respond to multiple requests for comment on reports about Meta's Gemini usage.
Compute access has also become a recruiting tactic.
Noam Shazeer, the former Gemini co-lead who recently left Google for OpenAI, reportedly cited reduced access to compute as part of his frustration.
At the same time, Chinese models are pushing pricing lower just as Google tries to build an enterprise business around Gemini. DeepSeek has said the fourth version of its open-source model is coming in two weeks.
That strain is now showing up on Alphabet's balance sheet.
Its cash pile is shrinking, it skipped buybacks in the first quarter for the first time in nearly a decade, and it has raised more than $140 billion in debt and equity as the AI capex race gets more expensive.
<small>Source: CNBC</small>
Business
Alphabet stock pops 4% on Dow debut, but the tech giant faces major AI questions
CNBC
June 29, 2026
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