Alphabet Jumps 8% as Google Avoids Breakup in Antitrust Case

Alphabet (GOOGL, Financials) shares surged 8% Tuesday after a U.S. federal judge ruled against breaking up Google's core platforms as part of remedies in a major antitrust case.

In the final decision, Judge Amit Mehta said Google will not be required to divest its Chrome browser or Android OS, rejecting one of the Justice Department's most aggressive proposals. He instead imposed restrictions on Google's exclusive contracts and required limited search data sharing.

The DOJ had accused Google of using compelled syndication to dominate internet search by locking in default placement deals with smartphone and browser makersmost notably Apple.

The court barred Google from making exclusive deals that tie payments to product preloading but stopped short of banning all payments. Mehta noted a full ban could harm partners and downstream markets.

Google must also share portions of its search index and user interaction data with rivals, but not ad targeting data. The court said such data sharing must happen under ordinary commercial terms consistent with Google's current practices.

Alphabet said it would review the ruling, while raising concerns over privacy risks and user impact. The company acknowledged the court's decision not to enforce divestiture as a win for consumer and partner continuity.

The DOJ welcomed the ruling as a meaningful step to open up search and preempt similar behavior in emerging markets like GenAI.

Apple, which earns billions annually from default search deals with Google, saw its stock rise 4% in after-hours trading.

The decision concludes a multi-year case that began with DOJ filings in 2020 and a trial that opened in late 2023. Final remedies are due to be filed by Sept. 10.