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Alphabet's market capitalization has declined by more than 4% in recent days. The cause is two powerful negative factors: a tough regulatory decision by the European Union requiring Google to open its search data and Android ecosystem to competitors, as well as a confirmed delay in the release of its flagship AI model, Gemini 3.5 Pro.

The short-term momentum that Alphabet's shares gained from the recent news of Warren Buffett's fund buying the stock has been almost completely erased. After the stock price approached the $370 mark, it is now trading around $353. The market is clearly reassessing the risks associated with Google's technological leadership and its ability to compete in the artificial intelligence race.

Regulatory Pressure: A New Front for Google

The European Commission has made an unprecedented decision, requiring Google to provide 11 key features of the Android operating system to third-party AI assistants. Moreover, the company will have to share anonymized search data with competitors, including OpenAI. These measures will take effect with the release of the next Android version in July 2027, and the transfer of search data will become mandatory from January 2027.

This decision creates a long-term structural risk for Google's business, as it undermines its key advantage — access to vast amounts of user data. In addition, next week the EU may impose another fine on the company in a different aspect of the same antitrust investigation. Regulatory pressure is also mounting from US authorities, who are closely examining the corporation's dominant position in the search sector.

Gemini Delay: A Worrying Signal for Investors

Alongside regulatory issues, Alphabet has faced internal difficulties. The launch of Gemini 3.5 Pro, which company CEO Sundar Pichai promised for June, is being delayed. The engineering team is still refining the model's performance, raising concerns: according to corporate metrics, competing systems are already outpacing Google's development.

The delay looks particularly alarming against the backdrop of record capital expenditures. Recall that Alphabet plans to spend between $180 and $190 billion this year on AI development. To fund these investments, the company has already changed its share buyback policy and conducted a massive $80 billion placement, with Berkshire Hathaway as the anchor investor.

Wall Street analysts forecast that for the second quarter, Alphabet's earnings per share will be around $2.86 — nearly 24% higher than last year's result. The key driver remains the Google Cloud business, which grew by 63% last quarter, reaching nearly $20 billion. This segment is the focus of investors assessing the company's ability to monetize its giant investments in artificial intelligence.

Buffett's Position: Long-Term Confidence

Amid the panic, Warren Buffett's actions appear as an island of stability. In a recent interview, he confirmed that he personally initiated the purchase of Alphabet shares, and Berkshire's stake in the company has already exceeded $31 billion, becoming the third-largest asset in the portfolio after Apple and American Express. Buffett openly called the colossal spending on AI "real and very serious money," warning the market against chasing short-term gains.

From my perspective, the current situation is a classic test of strength for long-term investors. Regulatory risks and AI delays are serious challenges, but the fundamental indicators of Google Cloud and the support of a heavyweight like Buffett suggest that the market may be overestimating short-term negative factors. However, investors should closely watch the quarterly report — it will be a key indicator of whether Alphabet is turning its billion-dollar investments into real profit.