Google parent Alphabet fell as investors fear a forced breakup of the company

Shares in Google parent company Alphabet Inc (NASDAQ:GOOG) fell more than 2% on Wednesday as the threat of a forced breakup loomed.

The US Department of Justice (DOJ) is said to be contemplating the breakup of the company – which dominates search and online advertising, whilst owning YouTube and also the Android smartphone operating system – in the wake of a federal court ruling that the company holds an illegal monopoly over the internet search market.

A breakup is one of several potential remedies the DOJ is reportedly exploring as a result of the ruling.

Whilst being among the more drastic potential measures, it could see the forced divestment of significant parts of Google’s business to potentially separate the likes of the Android operating system, the Chrome browser, or its advertising platforms.

The federal ruling, delivered last week, concluded that Google unlawfully maintained its dominance in the search engine market by paying billions of dollars to companies like Apple to ensure that Google remained the default search engine on their devices.

This, the court determined, effectively suppressed competition.

Other measures could alternatively force Google to share data with its competitors, or may see restrictions to prevent the company from leveraging its market position unfairly in emerging technologies like artificial intelligence.

Google has stated its intention to appeal the ruling but has not provided further comments on the DOJ's considerations.

Elsewhere, there are broader antitrust challenges against some of Silicon Valley’s largest firms including probes and potential sanctions against the likes of Meta, Amazon, and Apple.

In New York, Alphabet shares closed $3.90 or 2.35% lower priced at $162.03, and they were slightly lower during ‘afterhours’ dealing.