Key Takeaways
- Alphabet shares declined 3.4% on Thursday, settling at $280.92—the lowest closing price registered since mid-November 2025, following a jury verdict requiring Google and Meta to pay $6 million in a social media addiction case
- The stock continued its descent on Friday with an additional 1.2% drop to $277.70, marking a weekly decline exceeding 7%
- Wells Fargo elevated its price objective for Alphabet from $387 to $397 while keeping an Overweight designation
- The financial institution highlighted TPU processor licensing agreements with Anthropic and the $32 billion Wiz purchase as significant growth catalysts
- According to analyst Ken Gawrelski, Alphabet possesses “all the pieces necessary to be an AI winner”
Shares of Alphabet experienced a 3.4% downturn Thursday, reaching a closing price of $280.92—marking the company’s weakest finish since November 14, 2025, based on Dow Jones Market Data. The downward momentum persisted Friday with an additional 1.2% slide to $277.70.
The Thursday selloff followed a jury decision against Google’s YouTube platform and Meta in litigation filed by a plaintiff who claimed the social media giants engineered their applications to create addictive user experiences. The jury mandated a combined $6 million payment to the complainant. Meta shares tumbled nearly 8% Thursday and continued falling 1.5% Friday to reach $539.20.
The recent market action positions Alphabet for a weekly retreat surpassing 7%.
However, Wells Fargo issued an optimistic analysis Friday morning. The investment firm increased its price forecast for Alphabet to $397 from the previous $387 target, maintaining its Overweight recommendation. This updated projection implies a potential 41% appreciation from Thursday’s closing value.
Investment Bank Highlights Emerging Revenue Opportunities
Analyst Ken Gawrelski authored the research note, stating that Google is “leveraging its compute capacity advantage to develop new profit pools.”
The Wells Fargo team emphasized two strategic initiatives. Primarily, Google’s decision to license its tensor processing unit technology—referred to as TPUs—to Anthropic. Additionally, Alphabet’s all-cash $32 billion purchase of cybersecurity provider Wiz, which finalized on March 11.
According to Wells Fargo’s projections, TPU licensing arrangements will contribute 4% to Google Cloud Platform revenues during 2026, expanding to 7% in 2027. From an operating income perspective, the firm anticipates a 6% enhancement in 2026 and a 14% increase in 2027. The Wiz transaction is projected to deliver substantial additional value.
Gawrelski expressed increased confidence in “Google’s competitive position in search, given progress with AI mode and Gemini adoption.”
Wall Street Analyst: Google Has AI Winning Formula
The Wells Fargo research team asserted that Alphabet “has all the pieces necessary to be an AI winner.”
This represents a significant endorsement considering the competitive challenges Google Search has encountered from artificial intelligence-driven alternatives throughout the previous twelve months.
Alphabet’s equity now trades more than 17% below its 52-week peak. According to the Wells Fargo assessment, the current market price represents a substantial markdown relative to the firm’s fair value calculation.
