Alphabet's stock faces mounting pressure as the company prepares its quarterly earnings amid growing concerns about artificial intelligence disrupting its core search business. The emergence of new competitors in the AI space has rattled investors, with a Spanish startup named Maisa notably gaining recognition in prestigious Gartner reports alongside Google. This one-year-old venture has already secured over $5 million from US investors and develops hallucination-resistant AI agents for corporate use. Particularly significant is Maisa's distinction as one of only two European companies featured in Gartner's "Hype Cycle for AI," positioning it as a potential threat to Google's dominance.

Adding to Alphabet's challenges is an impending EU regulatory battle, where the company must defend its revised search page design proposals on July 7-8 in Brussels. Following March accusations of favoring its own services like Google Shopping and Google Hotels, Alphabet faces potential fines of up to 10% of its global annual revenue for Digital Markets Act violations. The company has responded with a "two-box system" approach, creating separate sections for specialized search engines and direct links to providers. Despite these mounting pressures, investment bank Truist maintains its positive outlook with a $200 price target, suggesting fears about the demise of traditional search may be overstated.

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Source StockWorld