"Google’s core Search revenue growth decelerated sharply to 12% year-over-year in Q3 2026, down from 19% in Q1 and 17% in Q2.
This sequential slowdown—culminating in a nearly $1.6 billion miss against Wall Street's 15% growth projections—triggered a historic 12.6% single-day stock plunge that wiped out roughly $500 billion in market value."


I guess you will need to decide on how to value a $240B run rate business line ($60B last quarter) that grew at 12% - and what future growth would look like. I personally think this is still a very attractive part of the Google business; that is probably worth at least 4x revenue;($960B in value?). This business is incredibly profitable.


A simple minded view would be

19% -> 17% -> 12% -> X?

X is 5% ?

Clearly they are pivoting to AI tools to offset this slowing growth - and that is requiring A LOT of capital. This disruption in their business will create a lot of volatility in their stock price - if you are confident they can transform it creates opportunity. I am reminded if MSFTs transition to the cloud - where their traditional desktop business was getting hammered - I made a ton of money off that (still hold MSFT today (up 10x - 15x on many of those purchases).

My general view is (and was with MSFT) that the downside is heavily protected with massive upside... seems like a fair trade-off.


tecmo
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