Google's Rollercoaster: Stock Gains Amid Antitrust Storm, Surges 17.52% YTD

As of last week, Google C (GOOG) surged by 0.95%, marking a three-day rally with a cumulative gain of 3.02%. Nevertheless, over the past week, it declined by 1.79%. Year-to-date, the stock has appreciated by 17.52%, resulting in a latest market capitalization of $2,035.951 billion.

Google C (GOOG) achieved a trading volume of $2.211 billion on August 9, 2024, ranking it as the 14th highest traded stock of the day on the US market. This represented a 14.39% decrease in trading volume from the previous day, with daily trading volume standing at 13.5492 million shares.

On August 9, 2024, the stock closed at $165.39, up 0.95%. Despite this, it has experienced a 1.79% loss over the past five trading days, a 4.48% decline in August, and a 17.36% increase year-to-date. Over the past 52 weeks, it has climbed 27.06%.

Google's recent legal entanglements underscore the significance of strategic market positions. The company has been embroiled in an anti-monopoly case, highlighting its practice of paying Apple to be the default search engine on Safari. This development, affirming the value of entry points like default search engines, showcases how Google’s market strategy centers around securing prime positions. In 2022, Google paid Apple over $20 billion for this privilege, underscoring the lucrative nature of these arrangements, as Apple held a 19% share of the phone market.

This antitrust ruling reveals Google’s extensive investments to maintain its dominance. While the company generated $162.5 billion in search and other business revenues in 2022, the fee to Apple alone illustrates the high stakes involved. AI's rise is seen to potentially transform hardware innovations in phases. Initially, it drives changes in chip architecture, memory, and overall device design, leading to higher average selling prices (ASP). Subsequently, as system-level AI develops, consumer willingness to pay for enhanced user experiences is expected to soar.

Alphabet Inc., the holding company for Google and its subsidiaries, evolved through a reorganization in 2015. Google, founded on September 4, 1998, in California and reincorporated in Delaware in August 2003, operates across various sectors, such as technology, life sciences, and capital investment. Its subsidiaries include Google, Calico, GV, Google Capital, and Google Fiber. The company focuses on internet search, cloud computing, and ad technologies, offering a wide array of internet-based products and services.

On August 6, 2024, Google C (GOOG) amassed a trading volume of $5.808 billion, positioning it as the 10th most traded stock of the day. The volume increased by 2.76% compared to the previous day, with 36.1465 million shares changing hands. On this day, the stock declined by 0.06%, closing at $160.54. The past five days saw a 6.59% drop, an entire August decline of 7.28%, but a year-to-date rise of 13.91% and a 52-week increase of 21.68%.

The recent ruling that Google maintains an illegal monopoly in online search marks a significant pivot. Accusations of using exclusive distribution agreements with browsers, smartphone manufacturers, and wireless carriers to cement its monopoly in general search services and text ads were substantiated by a Federal Judge. These partnerships, which entail sharing ad revenue from default access points on devices, were deemed anti-competitive.

In the wake of this judgment, stocks for both Alphabet and Apple tumbled, exemplifying market sensitivity to regulatory actions. Alphabet’s shares slid by over 4.4%, while Apple’s fell by 4.8%. Google plans to appeal the decision, emphasizing its ongoing legal strategies.

The ramifications of this antitrust victory extend beyond Google, highlighting regulatory rigor in curbing monopolistic practices. As articulated by the US Attorney General, this stands as a monumental win for the American public, symbolizing that no corporation is above the law.