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Google's Black Swan Event and a 25% Loss: ETFs to Consider
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Alphabet's (GOOGL - Free Report) shares have mirrored the broader market’s volatility in 2025. After surging 37% in 2024, the tech giant’s shares carried that momentum into early 2025, rising another 8.9%. Shares of the company reversed course in early February, falling around 30%, due to escalating trade tensions.
However, by April, Alphabet shares rebounded on easing trade tensions, adding 17% (as of June 2). GOOGL, which belongs to the Zacks Internet - Services industry, has a Zacks Rank #3 (Hold). It has a strong Growth Score of A.
Uncertainty continues to loom over the tech giant, as Google and the Department of Justice concluded closing arguments in the remedies phase of the antitrust trial last Friday. In what Barclays called a ‘Black Swan Event’ for the tech giant, the potential impact of the legal order could have drastic consequences for the company.
What’s at Stake for Google?
Google lost a landmark antitrust case brought by the U.S. Department of Justice (DOJ) in August 2024, with Judge Amit Mehta ruling that the tech giant had illegally monopolized the search engine market.
According to analysts at Barclays, as quoted on Yahoo Finance, Alphabet shares could fall by 15% to 25% if Judge Mehta orders a divestiture of the Chrome browser. The divestiture could land a drastic blow to the company.
Per Ross Sandler, an analyst at Barclays, a forced sale of Chrome could lead to a 25% drop in Alphabet’s stock and potentially slash the company’s EPS by as much as 30%, considering Chrome’s massive user base of 4 billion and its contribution to 35% of Alphabet’s search revenues.
According to Reuters, the U.S. DOJ has proposed that Google be required to sell its Chrome browser and share search data with competitors, with Judge Mehta expected to issue a ruling by August. As per Sandler, the most likely buyers of Chrome can be well-capitalized AI companies such as OpenAI, Anthropic or perhaps Perplexity.
Other Legal Developments
In another development, this Monday, Alphabet agreed to spend $500 million to change its compliance structure as part of a settlement with shareholders, according to Yahoo Finance.
The settlement is for a shareholder lawsuit that accused it of violating antitrust laws. Per Reuters, lawyers representing shareholders intend to request up to $80 million in legal fees and expenses, in addition to the $500 million settlement.
ETFs to Explore
The legal developments are likely to drive short-term volatility in the company’s shares. Here, we have highlighted ETFs with double-digit exposure to Alphabet.
IShares Global Comm Services ETF seeks to track the performance of the S&P Global 1200Communication Services 4.5/22.5/45 Capped Index with a basket of 68 securities. The fund has amassed an asset base of $415.5 million and charges an annual fee of 0.41%.
IShares Global Comm Services ETF has an exposure of 11.97% in GOOGL.
Fidelity MSCI Communication Services Index ETF (FCOM - Free Report)
Fidelity MSCI Communication Services Index ETF seeks to track the performance of MSCI USA IMI Communication Services 25/50 Index with a basket of 104 securities. The fund has amassed an asset base of $1.49 billion and charges an annual fee of 0.08%.
Fidelity MSCI Communication Services Index ETF has an exposure of 12.50% in GOOGL.
Vanguard Communication Services ETF seeks to track the performance of the MSCI US Investable Market Communication Services 25/50 Index with a basket of 116 securities. The fund has amassed an asset base of $4.74 billion and charges an annual fee of 0.09%.
Vanguard Communication Services ETF has an exposure of 12.49% in GOOGL.
MicroSectors FANG+ ETN seeks to track the performance of the NYSE FANG+ Index with a basket of 10 securities. The fund has amassed an asset base of $445.9 million and charges an annual fee of 0.58%.
MicroSectors FANG+ ETN has an exposure of 9.74% in GOOGL.
Communication Services Select Sector SPDR Fund (XLC - Free Report)
Communication Services Select Sector SPDR Fund seeks to track the performance of the Communication Services Select Sector Index with a basket of 23 securities. The fund has amassed an asset base of $21.82 billion and charges an annual fee of 0.08%.
Communication Services Select Sector SPDR Fund has an exposure of 8.71% in GOOGL.
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Google's Black Swan Event and a 25% Loss: ETFs to Consider
Alphabet's (GOOGL - Free Report) shares have mirrored the broader market’s volatility in 2025. After surging 37% in 2024, the tech giant’s shares carried that momentum into early 2025, rising another 8.9%. Shares of the company reversed course in early February, falling around 30%, due to escalating trade tensions.
However, by April, Alphabet shares rebounded on easing trade tensions, adding 17% (as of June 2). GOOGL, which belongs to the Zacks Internet - Services industry, has a Zacks Rank #3 (Hold). It has a strong Growth Score of A.
Uncertainty continues to loom over the tech giant, as Google and the Department of Justice concluded closing arguments in the remedies phase of the antitrust trial last Friday. In what Barclays called a ‘Black Swan Event’ for the tech giant, the potential impact of the legal order could have drastic consequences for the company.
What’s at Stake for Google?
Google lost a landmark antitrust case brought by the U.S. Department of Justice (DOJ) in August 2024, with Judge Amit Mehta ruling that the tech giant had illegally monopolized the search engine market.
According to analysts at Barclays, as quoted on Yahoo Finance, Alphabet shares could fall by 15% to 25% if Judge Mehta orders a divestiture of the Chrome browser. The divestiture could land a drastic blow to the company.
Per Ross Sandler, an analyst at Barclays, a forced sale of Chrome could lead to a 25% drop in Alphabet’s stock and potentially slash the company’s EPS by as much as 30%, considering Chrome’s massive user base of 4 billion and its contribution to 35% of Alphabet’s search revenues.
According to Reuters, the U.S. DOJ has proposed that Google be required to sell its Chrome browser and share search data with competitors, with Judge Mehta expected to issue a ruling by August. As per Sandler, the most likely buyers of Chrome can be well-capitalized AI companies such as OpenAI, Anthropic or perhaps Perplexity.
Other Legal Developments
In another development, this Monday, Alphabet agreed to spend $500 million to change its compliance structure as part of a settlement with shareholders, according to Yahoo Finance.
The settlement is for a shareholder lawsuit that accused it of violating antitrust laws. Per Reuters, lawyers representing shareholders intend to request up to $80 million in legal fees and expenses, in addition to the $500 million settlement.
ETFs to Explore
The legal developments are likely to drive short-term volatility in the company’s shares. Here, we have highlighted ETFs with double-digit exposure to Alphabet.
IShares Global Comm Services ETF (IXP - Free Report)
IShares Global Comm Services ETF seeks to track the performance of the S&P Global 1200Communication Services 4.5/22.5/45 Capped Index with a basket of 68 securities. The fund has amassed an asset base of $415.5 million and charges an annual fee of 0.41%.
IShares Global Comm Services ETF has an exposure of 11.97% in GOOGL.
Fidelity MSCI Communication Services Index ETF (FCOM - Free Report)
Fidelity MSCI Communication Services Index ETF seeks to track the performance of MSCI USA IMI Communication Services 25/50 Index with a basket of 104 securities. The fund has amassed an asset base of $1.49 billion and charges an annual fee of 0.08%.
Fidelity MSCI Communication Services Index ETF has an exposure of 12.50% in GOOGL.
Vanguard Communication Services ETF (VOX - Free Report)
Vanguard Communication Services ETF seeks to track the performance of the MSCI US Investable Market Communication Services 25/50 Index with a basket of 116 securities. The fund has amassed an asset base of $4.74 billion and charges an annual fee of 0.09%.
Vanguard Communication Services ETF has an exposure of 12.49% in GOOGL.
MicroSectors FANG+ ETN (FNGS - Free Report)
MicroSectors FANG+ ETN seeks to track the performance of the NYSE FANG+ Index with a basket of 10 securities. The fund has amassed an asset base of $445.9 million and charges an annual fee of 0.58%.
MicroSectors FANG+ ETN has an exposure of 9.74% in GOOGL.
Communication Services Select Sector SPDR Fund (XLC - Free Report)
Communication Services Select Sector SPDR Fund seeks to track the performance of the Communication Services Select Sector Index with a basket of 23 securities. The fund has amassed an asset base of $21.82 billion and charges an annual fee of 0.08%.
Communication Services Select Sector SPDR Fund has an exposure of 8.71% in GOOGL.