Alphabet Inc. shares slid sharply on Wednesday after Barclays flagged mounting long-term risks stemming from the ongoing U.S. Department of Justice (DoJ) antitrust trial against Google. The tech giant’s stock fell nearly 3% in early trading, reflecting growing investor anxiety as the high-stakes legal battle threatens to reshape the company’s business model and future profitability.
Barclays analysts issued a note to clients warning that the outcome of the DoJ trial could have “profound and lasting consequences” for Alphabet.
The DoJ’s case, which alleges Google unlawfully maintained monopolies in search and digital advertising, could result in sweeping remedies ranging from behavioral changes to potential divestitures of major assets such as Chrome, Android, or the company’s ad technology businesses.
Structural Remedies Could Impact Profits
Barclays outlined several scenarios, cautioning that the most severe outcome-a forced breakup or mandated changes to Google’s core business relationships-could erase up to 41% of Alphabet’s gross profit.
Even less drastic measures, such as requiring Google to implement choice screens for search or renegotiate revenue-sharing agreements with device partners, could still significantly disrupt the company’s lucrative search and ad businesses.
The note also highlighted the risk that courts could require Alphabet to adopt fixed-dollar revenue shares with partners, rather than percentage-based deals, further complicating its relationships with device makers like Apple and Samsung.
Market Reacts to Regulatory Uncertainty
The heightened regulatory scrutiny has weighed heavily on Alphabet’s stock throughout 2025, with shares down nearly 20% year-to-date. Investors remain wary as the trial progresses, with Barclays emphasizing that the legal outcome is now the single most important factor for Alphabet’s valuation and future growth prospects.
Other analysts share the cautious outlook. While some, including Evercore ISI, have trimmed their price targets, they note that Alphabet’s core business remains fundamentally strong, with robust performance in cloud, YouTube, and advertising.
However, the specter of a court-ordered breakup or major business overhaul continues to overshadow the company’s operational achievements.