Alphabet joins the Dow Jones on June 29: a triumph amid a $250 billion personnel crisis
Starting June 29, Alphabet (GOOGL) will officially take a place in the Dow Jones Industrial Average index, replacing Verizon Communications. However, this historic move coincided with an unprecedented outflow of key figures in the field of artificial intelligence, triggering a sharp drop in the shares of Google's parent company.
On June 23, S&P Dow Jones Indices announced the inclusion of Alphabet in the prestigious 30-company index. Verizon, whose share was only 0.5% due to its low stock price, is leaving the basket. The higher value of Alphabet's shares will give it significantly more weight in this benchmark, reflecting a shift toward the technology sector.
Double blow: departure of a Nobel laureate and co-author of "Attention Is All You Need"
The news of inclusion in the Dow Jones did not protect Alphabet's shares from a collapse. Over a single trading session, the company's market capitalization shrank by nearly $250 billion — shares fell by 6%, marking the worst day in the past year and the sharpest decline since February.
The reason for the panic is two high-profile resignations. John Jumper, a 2024 Nobel laureate in chemistry for developing AlphaFold, left Google DeepMind after nearly nine years of work and moved to Anthropic. And a few days earlier, on June 18, Noam Shazeer — co-author of the landmark 2017 paper "Attention Is All You Need" and one of the leaders of the Gemini project — announced his move to OpenAI. Notably, less than two years ago, Google paid about $2.7 billion to bring Shazeer back from Character.AI.
New Dow Jones composition: betting on AI
At S&P Dow Jones Indices, they explained that the update to the index composition is driven by Alphabet's strong positions in technology, digital advertising, cloud services, and artificial intelligence. With Verizon's departure, the Dow Jones loses its last company from the telecommunications sector and becomes even more closely tied to the AI-driven economy. Earlier, in 2024, Amazon joined the index, while Apple and Microsoft were already present. Now Alphabet has joined them.
Cryptalist Analysis: Inclusion in the Dow Jones is undoubtedly a recognition of Alphabet's scale. But the market sees deeper: the personnel crisis at Google, where key AI architects are leaving for direct competitors, cannot be solved by a simple spot in the ranking. For investors, this is a signal: behind the formal triumph lies a real threat of losing technological leadership.