Alphabet Loses $270 Bn After Google AI Departures; How Two Exits Sparked Concerns

Google parent Alphabet lost around $270 billion in market value on June 19 as its shares fell nearly 5%. The decline came after two senior artificial intelligence researchers announced departures from Google to join rivals OpenAI and Anthropic.

Noam Shazeer became the first of the two researchers to leave Google. The vice president of engineering, who helped lead the company's Gemini artificial intelligence models, announced on June 16 that he was joining OpenAI.

His departure came less than two years after Google secured his return through a $2.7 billion partnership deal involving Character.AI, the start-up he co-founded with Daniel De Freitas.

Three days later, John Jumper also announced that he would leave Google DeepMind for Anthropic, bringing an end to his nine-year association with the company. The engineering fellow helped develop AlphaFold and shared the 2024 Nobel Prize in Chemistry with DeepMind CEO Demis Hassabis.

The AlphaFold Impact

AlphaFold is one of Google's biggest artificial intelligence breakthroughs. The system can predict a protein's three-dimensional structure from its amino acid sequence, a process that once took researchers months or even years to complete in laboratories.

The tool has generated more than 200 million protein structure predictions, covering nearly every catalogued protein known to science. More than 3 million researchers across 190 countries use it to study diseases and other medical challenges.

Google DeepMind later partnered with its sister company, Isomorphic Labs, to develop AlphaFold 3. Released in May 2024, the latest version is 50% more accurate than traditional methods in predicting how proteins interact with drugs and antibodies.

Industry estimates suggest artificial intelligence-assisted target identification could reduce Phase I drug development costs from $100 million to $70 million.

Broader Market Pressures

According to reports, the departures came shortly after Google unveiled the Gemini 3.5 Flash model and the Gemini Spark artificial intelligence agent at its I/O developer conference in May.

Investors were also reacting to comments from Microsoft CEO Satya Nadella, as published in The Wall Street Journal. Nadella suggested the technology industry should rely less on a handful of artificial intelligence leaders and said the market was increasingly becoming commoditised.

At the same time, Alphabet continues to pour significant resources into its artificial intelligence ambitions. The company has raised $141 billion through debt and equity markets since October 2024 to support its vertically integrated AI infrastructure strategy.