Google stock drops amid DeepMind leadership shake-up

Google's stock fell nearly 4% after the company announced a leadership shake-up at its AI-focused DeepMind organization, with CEO Demis Hassabis transitioning to chair of DeepMind and chief scientist for all of Alphabet, and CTO Koray Kavukcuoglu stepping into the role of senior vice president for DeepMind. Additionally, Google chief scientist Jeff Dean and senior fellow Sanjay Ghemawat are leaving to found an independent public benefit corporation called Discovery Loop, focused on automating machine learning and science. The announcement comes as Google faces delays with its Gemini 3.5 Pro model and increased capital expenditures to between $195 billion and $205 billion.

Google GOOG https://finance.yahoo.com/quote/GOOG/ , GOOGL https://finance.yahoo.com/quote/GOOGL/ announced a major shake-up in its AI-focused DeepMind organization on Wednesday. CEO Demis Hassabis is transitioning to a new role as chair of DeepMind and chief scientist for all of Alphabet. DeepMind CTO and Google chief AI architect Koray Kavukcuoglu will step into the role of senior vice president for DeepMind and report directly to Alphabet CEO Sundar Pichai. Google stock fell nearly 4% on the news. In addition to those moves, Google chief scientist Jeff Dean, along with Google senior fellow Sanjay Ghemawat, are leaving the company and founding their own independent public benefit corporation called Discovery Loop. In a post on X https://x.com/JeffDean/status/2085034604172603724/photo/1 , Dean said Discovery Loop's mission is to "automate machine learning, science, and engineering to accelerate discoveries and progress." Google stock has benefited from the company's strong AI growth, with Google reporting sales increased https://finance.yahoo.com/markets/article/google-cloud-is-becoming-alphabets-new-profit-engine-chart-of-the-day-090000053.html a whopping 82% year over year in its most recent quarter, jumping to $24.77 billion. That easily outpaced analysts' expectations of $24.56 billion and was well ahead of the $13.6 billion the company brought in last year. Shares of Google are up 86% over the past 12 months and 15% year to date, easily outperforming rivals Amazon AMZN https://finance.yahoo.com/quote/AMZN/ , which is up 28% over the past year, and Microsoft MSFT https://finance.yahoo.com/quote/MSFT/ , which is down more than 8% during that timeframe. But Google is facing some difficulties with its latest Gemini model. According to Bloomberg https://www.bloomberg.com/news/articles/2026-07-16/google-gemini-launch-delayed-as-tech-falls-short-of-internal-goals , the company delayed its Gemini 3.5 Pro in July in an effort to improve its capabilities in areas like coding. And during its latest earnings report, the company increased its planned capital expenditures for the year to between $195 billion and $205 billion, up from its prior estimate of $180 billion to $190 billion. Analysts were expecting $186.4 billion. That sent shares plunging more than 6% at the time, but they've since recovered those losses. Email Daniel Howley at dhowley@yahoofinance.com. Follow him on X at @DanielHowley . Click here for the latest technology news that will impact the stock market . Read the latest financial and business news from Yahoo Finance