Alphabet (GOOG) underperformed due to generative AI concerns

From Yahoo Finance: 2025-05-07 09:51:00

Mairs & Power released their first quarter 2025 investor letter, reporting a record high in February but a fall in equities due to tariff uncertainty in March. The fund ended the quarter up 0.04%, outperforming benchmark indexes and the Morningstar Moderate Allocation peer group. Check the fund’s top five holdings for 2025 picks.

In their Q1 2025 letter, Mairs & Power Balanced Fund highlighted Alphabet Inc. (NASDAQ: GOOG), parent company of Google. Alphabet Inc. (GOOG) operates through Google Services, Google Cloud, and Other Bets segments, with a one-month return of 2.57%. Shares lost 3.48% over the last 52 weeks, closing at $165.20 per share on May 6, 2025.

Mairs & Power Balanced Fund noted Alphabet Inc. (NASDAQ: GOOG) underperformed due to concerns about generative AI impacting the search business. The fund cited security selection issues and the stock falling with other mega-cap tech stocks.Concerns were raised about Alphabet’s response to generative AI’s impact on its search business.

Alphabet Inc. (NASDAQ: GOOG) is the 7th most popular stock among hedge funds, with 174 portfolios holding the stock at the end of Q4 2024. In Q1 2025, Alphabet Inc. (GOOG) achieved a revenue of $90.2 billion, with a 12% increase in constant currency. While Alphabet Inc. (GOOG) is promising, AI stocks may offer higher returns in a shorter timeframe.



Read more at Yahoo Finance: Alphabet (GOOG) Fell Along with Peers