AI News Monitor

Shares of Alphabet (GOOGL) and Apple (AAPL) fell sharply Wednesday after Eddy Cue, Apple’s services chief, testified in the DOJ’s antitrust case against Google, revealing concerns about AI’s impact on traditional search engines.

Cue, speaking in federal court, said AI-powered search tools like those from OpenAI, Anthropic, and Perplexity could eventually replace standard search engines, including Google. He confirmed Apple is considering integrating these AI services into Safari as alternative search options.

The testimony intensified investor worries about Google’s $20 billion annual deal with Apple, which makes Google the default search engine on iPhones. Cue admitted the partnership is crucial for Apple’s revenue, saying he’s “lost sleep” over potentially losing it. He also noted that Safari searches declined for the first time in 20 years in April, attributing the drop to rising AI usage.

Alphabet’s stock plunged over 7%, wiping out roughly $250 billion in market value, while Apple shares dipped 1%. The sell-off reflects broader concerns about Google’s legal troubles—it now faces two major antitrust cases that could force structural changes to its business.

With 89.7% global search market share, Google remains dominant, but Cue’s remarks signal a potential AI-driven shift that could disrupt the tech giants’ long-standing alliance.