Alphabet stock (GOOGL) took a hit during Wednesday’s trading session following Apple’s announcement of looking into its own AI search engine. Eddy Cue, Apple’s senior vice president of services, made the disclosure yesterday, prompting Alphabet shares to take a 7% nosedive. Cue also shared that Safari search volume had declined in April for the first time in over two decades, causing concern among investors in both tech giants.

Apple and Google are currently weighing an estimated $20 billion-a-year deal that makes Google the default offering for queries in Apple’s included browser. However, the announcement puts a damper on that plan. Investors, already nervous about AI’s disruption of search, wiped roughly $155 billion off Alphabet’s market cap in 24 hours. Now, there is worry that the stock could fall as well, perhaps below $150.

Alphabet (GOOGL) stock is trading near the bottom of its 52-week range and below its 200-day simple moving average. The stock has since recovered a little over 1% from the Wednesday drop, but is still down 4% in the last five days. Most analysts aren’t suggesting to panic sell just yet, but there are still growing concerns around GOOGL.

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According to analysts at Jeffries, the selloff may be overblown. In a note released late Wednesday, titled “Don’t Rush to Count Out Google Search,” analysts from the investment bank argued that Safari’s shrinking share is a limited threat. While Apple’s browser holds 17% of global market share, Google Chrome commands 66%, giving Alphabet a much larger footprint regardless of what Apple does. Additionally, daily active users of the Google app on iOS have climbed 15% year over year. The search engine, despite being under fire, remains a hot commodity.

Furthermore, Alphabet’s Q1 2025 earnings report delivered better-than-expected numbers. For Q1, Alphabet reported earnings per share (EPS) of $2.81 on revenue of $90.2 billion. Analysts were expecting EPS of $2.01 on revenue of $89.1 billion, according to Bloomberg consensus estimates. The company reported earnings per share of $1.89 on revenue of $80.5 billion during the same period last year. Therefore, it may not be time to panic on Alphabet stock just yet.