Google stock retreated Wednesday on a report that the Justice Department is mulling a breakup of parent Alphabet following last week's antitrust court victory vs. the internet giant.
A federal judge on Aug. 5 ruled that Google violated antitrust laws by engaging in unfair business tactics to dominate the internet search advertising market. Alphabet's $20 billion in annual payments to Apple, which make Google the default search engine on iPhones, were a central part of the government's case.
A second phase of the trial must now take place to determine what remedies the federal court will order. Google will likely appeal.
During the remedy phase of the trial, the DOJ could seek to end exclusive search deals, such as making Google the default search provider on the Apple iPhone. If the DOJ aims for a breakup, it would probably seek to carve off the Android mobile operating system and Google's Chrome web browser.
Google Stock: Second Antitrust Trial Starts Sept. 9
Google stock initially opened slightly down on Wednesday. On the stock market today, Google stock fell 3.6% to 158.28 in morning trading.
Further, another government antitrust lawsuit vs. Google is slated to start Sept. 9. Some analysts call it the "DoubleClick trial." In 2008, Google acquired a leading digital advertising firm DoubleClick for $3.1 billion.
The DOJ claims Google's dominance of the digital ad market has damaged advertisers and content creators. The advertising antitrust case will take place at the U.S. District Court for the Eastern District of Virginia with federal judge Leonie Brinkema presiding.
With Wednesday's retreat, Google stock was still up over 13% in 2024. Google stock hit a new all-time high of 191.75 on July 10 but has pulled back sharply along with other Magnificent Seven companies amid greater investor scrutiny of artificial intelligence plays.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
