Alphabet shares rise after ruling in favor of antitrust lawsuit

On Wednesday, shares of Alphabet’s Google increased by around 8% following a US judge’s decision not to break up Google’s parent company. This ruling eliminated a significant regulatory obstacle and positioned the tech giant to potentially add about $206 billion to its market value.

With the ruling issued on Tuesday by Judge Amit Mehta, Google is permitted to maintain control of its Chrome browser and Android mobile operating system. But certain exclusive contracts with device makers and browser developers are prohibited. It also enabled Google to keep paying partners such as Apple to advertise its search engine. Shares of the iPhone manufacturer increased by 3.2%.

Shares of Alphabet, which reached an unprecedented intraday peak of $230.86, have risen nearly 11.7% year-to-date as of the latest close. Slightly surpassing the performance of the S&P 500 index. However, they lag behind those of Big Tech counterparts like Meta and Microsoft. Analysts noted that the ruling maintains Alphabet’s capacity to enhance its collaboration with Apple and possibly incorporate its Gemini artificial intelligence into upcoming iPhones.

Bloomberg News reported that Apple was engaged in initial discussions about utilizing Gemini AI for redesigning its Siri voice assistant, aiming to integrate it into upcoming devices.

In 2020, the US government filed a lawsuit against Google, alleging that it was illegally sustaining a monopoly on search through exclusive agreements with device makers and browser developers.

The current trading price of Alphabet’s stock corresponds to 20.3 times the projected earnings. This is a lower valuation compared to other firms in the «Mighty Seven» and the wider S&P 500 index.