Google Chrome Divestiture Could Wipe 25% off Alphabet Stock

As Google’s case with the Justice Department nears its end, if Judge Amit Mehta orders Google to sell off its Chrome browser, Alphabet stock (GOOG, GOOGL) could drop between 15% and 25%. Last August, Google lost an antitrust trial against the Justice Department and was found guilty of monopolizing the search engine market. 

If ordered to divest the Google Chrome browser, which accounts for 35% of its revenue and has 4 billion users, the Alphabet stock price could take a significant hit. In the antitrust trial loss, the U.S. Department of Justice is pushing for remedies that include sharing search data, banning exclusivity agreements, and the divestiture of Google Chrome. 

The Alphabet stock has been down 1.58% recently because of investor concerns about the ongoing legal troubles with the Justice Department. Google is planning to appeal the ruling, as the continuing antitrust battle is casting a significant shadow over its future. The Alphabet stock will obviously suffer, but so will Google’s market dominance. 

Last Friday, closing arguments were concluded in the remedies phase of the case, and the Justice Department seeks to have the judge order the divestiture of Google Chrome. Market analysts say that the probability of a Google Chrome divestiture is low, but there is a chance that well-funded AI companies, such as OpenAI and Anthropic, might acquire Google Chrome. 

Such a development would be a significant setback, a black swan event for Alphabet stock. Shares would tumble, potentially resulting in a 30% hit to Alphabet’s earnings per share. Judge Mehta will rule on a remedy to the case and the fate of Google Chrome in August. 

Google Chrome Is Integral to Google’s Search Empire

There is heightened investor concern affecting Alphabet stock, as the Google Chrome browser is a critical asset. It has a vast user base and it funnels traffic to Google’s search engine, which is the primary source of its advertising revenue. The ecosystem would be irrevocably disturbed by the divestiture of Google Chrome. It would reshape the competitive landscape and give Google’s rivals access to a browser with unparalleled market reach. 

Alphabet stock is facing volatility, reflecting investor unease, and year-to-date, the stock has declined by almost 11%, despite Alphabet’s $2.09 trillion market cap. 

Regulators have long targeted Google Chrome because it reinforces Google’s dominance in search, along with Google’s agreements with device manufacturers and browser developers. The Justice Department intends to level the playing field, especially with emerging AI-driven search platforms. Google argues that such measures will stifle innovation and affect its ability to compete internationally, which is why it intends to appeal the court’s decision. This means that a protracted legal fight could delay remedies and have little impact on alleviating investor concerns. 

The potential divestiture of Google Chrome marks a pivotal moment for Alphabet and the broader tech industry. With Chrome serving as a cornerstone of Google’s search dominance, any forced sell-off could have far-reaching implications, not just for Alphabet’s revenue but for the entire digital advertising ecosystem. Investor anxiety is already evident in Alphabet’s stock performance, and if Judge Mehta rules in favor of the Justice Department’s proposed remedies, the fallout could trigger a significant financial and strategic reset for Google.

Although the probability of a full divestiture remains uncertain, even the looming possibility has cast a long shadow over Alphabet’s market outlook. Google’s plan to appeal the antitrust ruling may delay any immediate impact, but it won’t eliminate investor fear or the risk of future regulatory action. As we await the final verdict in August, stakeholders must prepare for a decision that could significantly impact the future of Alphabet, the search industry, and the regulation of browser-market power in the AI era. Google recently held the I/O 2025, and most of the announcements were related to AI, so while Google is leading the AI revolution, its search engine remains its backbone. 

About the Author: Sarah Zimmerman is a seasoned crypto and Web3 news writer passionate about uncovering the latest developments in the digital asset space. With years of hands-on experience covering blockchain innovations, cryptocurrency trends, and decentralized technologies, she strives to deliver insightful and balanced news that empowers her readers. Her work is dedicated to demystifying complex topics and keeping you informed about the ever-evolving world of technology.