Alphabet shed close to $250bn in market value on Monday after two of Google’s most senior AI researchers left for rivals. What began as a single-name talent shock has since broadened into a semiconductor-led sell-off across global tech.
Noam Shazeer, VP of engineering and co-lead of Google’s Gemini models, announced his move to OpenAI on 18 June; the next day John Jumper, the Nobel laureate behind AlphaFold, said he was leaving DeepMind for Anthropic. With US markets shut on Friday for the holiday, the reaction landed in Monday’s session; the shares fell as much as 7.2% intraday and closed 5% to 6% lower, the worst session in about a year. The Nasdaq fell 1.3% that day as Amazon, Meta and Microsoft also dropped, and only the Dow closed higher; the talent exits were the spark, not an isolated move against a rising market.
By Tuesday the selling had broadened into a global rout. A near-10% drop in South Korea’s KOSPI led an overnight sell-off in memory chips that took the Nasdaq down 2.2% and the S&P 500 down 1.4%; Micron fell more than 11%, Qualcomm around 8% and Nvidia about 4%. Alphabet fell around 2%, less than the index, as the driver shifted from its own headlines to a sector-wide reassessment of AI spending against returns.
By Wednesday the tape steadied. US index futures rose and Alphabet gained around 0.5% in early trade, after S&P Global confirmed the stock will join the Dow Jones Industrial Average from the start of trading next Monday, replacing Verizon. The promotion lands in the same week the talent exits wiped a quarter of a trillion dollars off the company. The next catalyst is Micron’s earnings after Wednesday’s close, read as a direct gauge of AI demand.
The move sits on a stock already under scrutiny for its spending. In its 3 June investor presentation Alphabet guided 2026 capital expenditure to $180bn to $190bn, around six times the 2022 level and double last year, with a further significant rise flagged for 2027. To fund it, the company announced a proposed $80bn equity raise earlier this month, including a $10bn investment from Berkshire Hathaway; an oversubscribed underwritten tranche took the expected total to around $85bn. Management framed the raise as protecting financial flexibility; the market is reading the same spend more warily. The durable thread is the talent war, with Anthropic and OpenAI now pricing frontier researchers at levels Google has to match; the open question is whether the build pays. The next test is Alphabet’s second-quarter earnings in mid July.
