Will Google Stock Split in 2025?
No, the Board of Alphabet, the parent company of Google, has made no announcement about a stock split nor has Alphabet CEO Sundar Pichai teased any pending decision.
However, with Google now under the spotlight of regulators with a possible breakup of the company being considered, Pichai might soon need to take measures to sure-up investor confidence.
Key Takeaways
- Google has conducted only two stock splits—one in 2014 and another in 2022—making their stock split history limited compared to other tech giants.
- Regulatory scrutiny, including a potential breakup due to antitrust rulings, makes another stock split unlikely in the near term as Alphabet’s management focuses on legal challenges.
- Alphabet faces increased competition in AI, which has become a critical focus area as rivals like OpenAI and Meta gain ground, potentially overshadowing stock split considerations.
- A future stock split could make Google shares more affordable, but no such move is expected in 2024 unless the stock price reaches new highs.
Why Doesn’t Google Split Its Stock?
1. GOOG Stock Price
Alphabet (GOOG) stock was around $165 as of October 21, 2024, almost 15% off its record high of $193.31 set in 2024.
Google stock split rumors aside, if Chief Executive Pichai and his team didn’t think there was a need for a stock split over $190, it seems logical they still aren’t thinking about a split now when the price is lower and less prohibitively high for retail investors.
You can keep Alina’s style as usual – do not mark the latest price please
But never say never, and a Google stock split date could still get squeezed late into 2024 after what has been a great couple of years for shareholders.
Despite the recent pullback, the shares have been up significantly since the market bottomed in October 2022, thanks in part to optimism around Google’s role in the development of artificial intelligence and broad market positive sentiment.
Technically a stock split in 2024 is still possible, but the more probable scenario would be in 2025 or beyond if/when the GOOG stock price rises to new record highs.
2. Breakup Risk
Alphabet, the parent company of Google, finds itself under intense regulatory scrutiny following a Department of Justice antitrust ruling. The ruling, which asserts that Alphabet has engaged in monopolistic behavior in the online search space, now opens the door to potential remedies that are anything but light-handed.
Among the proposed outcomes is the forced divestiture of core assets, such as Google’s ad business or even elements of its search platform.
The scale of attention and resources required to navigate a potential breakup would consume management’s focus entirely. Any notion of enhancing investor accessibility through stock mechanics pales in comparison to the gravity of restructuring the company’s very architecture. A stock split, while possibly attractive in calmer times, probably does not align with the present imperatives of survival and strategic defense.
3. Gemini & Google AI
Alphabet’s Google, once an undisputed leader in tech innovation, now faces fierce competition in the AI race, particularly from rivals like OpenAI’s ChatGPT and Meta AI.
As AI becomes the defining frontier for future dominance in technology, Google’s position is no longer as secure as it was in the days when search and advertising made it a market leader. The company is actively seeking to maintain its stronghold, but the rapid advancements of competitors are pressuring Google to push its AI capabilities forward, both in terms of language models and broader AI applications.
Google’s AI initiative, including its chatbot Bard later renamed Gemini, and other AI-driven products, has not yet gained the same widespread recognition as ChatGPT, which exploded into mainstream use. Losing out in the AI race could mean ceding market share not just in search but in the wider spectrum of data-driven products and services.
In the context of these existential challenges, it is unlikely that management would prioritize a stock split.
What Does This Mean for Investors?
Without a Google stock split on the horizon, investors needn’t give it too much thought.
If one were to occur, at Alphabet’s current stock price of around $165, a 2-for-1 stock split would halve the price per share to approximately $82.50 while doubling the number of shares each investor holds.
Similarly, a 3-for-1 split would reduce the price per share to about $55, tripling the number of shares.
Google Stock Split History
Google-parent Alphabet has carried out two previous stock splits, the first being so controversial that it resulted in a shareholder lawsuit.
Google Stock Split 2014: 2-for-1
On March 27 2014, Alphabet initiated a 2-for-1 stock split, but instead of simply doubling the shares, it created new Class C shares without voting rights. For every Class A share, shareholders received one Class C share. This action was taken after settling a lawsuit with some disgruntled shareholders who were none-too-happy about the arrangement.
This move was designed to preserve the founders’ control over the company by preventing dilution of their voting power, as Class A shares retained voting rights while Class C did not. This structure allowed the company to raise capital without weakening the influence of its founders and leadership team.
Google Stock Split 2022: 20-for-1
Google’s last stock split in 2022 turned out to be a big year for stock splits, especially among megacap tech stocks (like Tesla) after meteoric rises during 2021. On July 18, Alphabet (GOOG) class A stock opened at a split-adjusted price of $112.64, just one 20th of the price before the split at $2,255.34 on July 15.
- Google’s last stock split was a big 20-for-1 split on July 18, 2022.
- The Google stock price before the split (i.e., the closing price on July 15, 2022, the last trading day before the split) was around $2,255 per share.
- The Google stock price after the split (i.e., on July 18, 2022, after the split took effect) was the opening price adjusted to around $112 per share.
How Many Times Has Google Stock Split?
Google’s stock split history has just two instances since the Google IPO 20 years ago in 2004.
The relatively few splits best explain the need for the large 20-for-1 split in 2022.
As a basis for comparison, Microsoft stock was split nine times since 1987, and Apple completed a stock split five times in its nearly 40 years as a public company.
Will Google Ever Split Its Stock Again?
Given the consistent appeal of stock splits among corporate boards and the historical trend of tech giants enacting them, another Google stock split could be highly probable. Yet, there’s little talk of such a move today.
Company leadership remains silent on the topic until formal announcements are made, and analysts tend to avoid speculating or making any Google stock split prediction. With no insider information, they’re left to speculate, as it’s ultimately a straightforward yes-or-no decision, making predictions unreliable without concrete insights.
Top 5 Tech Stocks With Frequent Stock Splits
Among the many technology companies that have split, here are five companies that chose to make their shares more accessible, ensuring they stay in the conversation among investors given all the competition in the tech arena.
Amazon implemented a 20-for-1 stock split in June 2022, marking its first split since 1999. This move significantly reduced the share price, making Amazon stock more affordable for retail investors after years of price growth.
Tesla has conducted several stock splits in recent years. In August 2022, the company executed a 3-for-1 split, following a 5-for-1 split in 2020. These actions were designed to make Tesla shares more accessible to everyday investors.
Apple has a long history of stock splits, with the most recent being a 4-for-1 split in August 2020. Apple’s frequent use of splits over the years has helped ensure that its stock remains attractive to a broad spectrum of investors.
In July 2021, Nvidia executed a 4-for-1 stock split as its stock price surged due to the company’s growing presence in AI and gaming. This move made the shares more accessible to smaller investors.
Shopify carried out a 10-for-1 stock split in June 2022, aiming to attract a wider range of investors by lowering its share price. This move helped the e-commerce company maintain its momentum as it continued to grow in the online retail space.
What Is a Stock Split?
A stock split is a corporate action in which a company increases its total number of shares by dividing up the existing ones. This action is usually intended to improve liquidity and make shares more affordable for a wider range of investors.
Why Are They Important to Investors?
For the shareholders in companies that carry out a stock split, they can sometimes see some added speculative interest around the time the split is announced, which can increase the value of their holdings.
However, there is a tendency for the share price to give this back once the split is enacted, meaning the consequences of a split for long term investors are less tangible.
The Bottom Line
While an Alphabet stock split isn’t on the immediate horizon, it remains a possibility if the stock price reaches new highs or if market conditions shift in 2025 or beyond.
Regulatory challenges and competitive pressures in AI have taken priority, making a split less likely in the short term. Investors should focus more on Google’s broader strategic moves rather than speculating on a stock split for now.