Google parent company Alphabet (GOOGL) has avoided a break-up of its business in the U.S. antitrust case that found it holds an illegal monopoly in online search.
The U.S. Department of Justice (DOJ) had called for a break-up of Alphabet’s business, including divesting its Chrome browser, in the antitrust case that began in 2023.
However, U.S. District Court Judge Amit Mehta ruled against the most severe consequences proposed by the Justice Department and said Alphabet can keep its Google Chrome browser.
GOOGL stock is up 6% in premarket trading as the ruling is viewed as favourable to the company.
Judge Mehta also said that Alphabet can still make payments to companies to preload its Google search engine on electronic devices.
That means Alphabet can continue paying Apple (AAPL) billions of dollars a year so that Google is the default search engine on iPhones.
Judge Mehta did rule that Alphabet cannot have exclusive contracts that condition payments or licensing.
However, that ruling is seen as minor in the grand scheme of things and not something that will materially impact Alphabet’s long-term business.
Dan Ives, global head of technology research at Wedbush Securities, called the outcome of Alphabet’s antitrust case a “monster win” for the company.
Ives notes that the ruling also means Alphabet will not have to divest the Android operating system that it is developing.
Android is seen as a key tool for Alphabet to increase the number of users for its Gemini artificial intelligence (A.I.) system as 70% of smartphones globally run the operating system.
There had been concern that Alphabet’s business could have been broken up in the antitrust case. The outcome in the case removes many of those worries.
Prior to today (Sept. 3), GOOGL stock had risen 12% this year to trade at $211.35 U.S. per share.
