Alphabet Gemini delay and capex stock drop
Analysis based on 7 articles · First reported Jul 21, 2026 · Last updated Aug 07, 2026
Alphabet's stock price dropped significantly, erasing billions in market value, as investors reacted to the AI model delay and increased spending plans. The investigation by Pomerantz LLP adds legal and reputational risk, potentially affecting investor confidence and the broader tech sector sentiment.
Alphabet Inc. faced a significant stock decline in July 2026 following reports that its flagship AI model, Gemini 3.5 Pro, was months behind schedule due to coding difficulties. On July 16, 2026, Bloomberg News reported the delay, causing Alphabet's stock to fall 4.4% to $353.81. Subsequently, on July 22, 2026, Alphabet released its Q2 2026 earnings, revealing a substantial increase in full-year capital expenditures to $195-205 billion, negative free cash flow of $5.9 billion, and plans to use third-party capacity in Q3, which would create margin pressure. This news led to a further 6.89% drop in the stock to $318.34 on July 23. In response, Pomerantz LLP initiated an investigation into whether Alphabet and its officers engaged in securities fraud or unlawful business practices, representing investors who suffered losses.
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