Waymo’s Global Expansion Strengthens the Case for GOOGL Stock
Alphabet (NASDAQ: GOOGL) has been on an exceptional run in the second half of the year, playing catch-up and now leading the broader market. What were once viewed as headwinds have turned into powerful tailwinds. Concerns over AI competition have subsided, with Google now firmly reestablished as one of the dominant players in the next wave of enterprise AI and cloud computing. Regulatory fears surrounding the potential breakup of Chrome have also faded, allowing Alphabet’s core business to strengthen across the board.
As profitability continues to improve across Google Services and Google Cloud, many investors and spectators might be unaware of one of Alphabet’s most intriguing segments, “Other Bets.” This division is home to the company’s moonshot ventures. Experimental projects that may not yet contribute materially to earnings but have the potential to revolutionize entire industries. One of the most ambitious of these is Waymo, Alphabet’s autonomous driving subsidiary.
Waymo and the Promise of Other Bets
Alphabet’s Other Bets segment was designed to incubate innovation beyond its core advertising and search business. It includes long-term, high-upside projects like Verily (health technology), Wing (drone delivery), and most notably, Waymo.
While the segment continues to operate at a loss, it’s showing signs of improvement. In Q2 2025, Other Bets generated $373 million in revenue against a $1.25 billion loss. It’s a substantial loss, but one that underscores Alphabet’s commitment to long-term growth through disruptive innovation. And Waymo remains the cornerstone of this vision.
Waymo operates commercial, fully driverless ride-hailing services across several U.S. cities, including Phoenix, San Francisco, and Los Angeles, with expansion underway in Atlanta and Austin. The company has logged millions of autonomous miles and provided over 10 million paid rides. The vehicle is powered by its cutting-edge sensor suite of radar, lidar, and cameras. Last year, Alphabet committed another $5 billion to Waymo’s development, underscoring the strategic importance of the business within its future roadmap.
Waymo Enters Europe
The latest catalyst for Waymo, and perhaps for Alphabet’s long-term growth story, is its official expansion into Europe. The company announced it will begin testing its driverless ride-hailing service in London, marking its first European market entry.
According to the company’s statement, test drives on London roads will begin in the coming months with human safety specialists behind the wheel. Full commercial service could launch as early as next year, pending regulatory approvals from local and national authorities. London will become Waymo’s second international city after Tokyo, where testing began in early 2025.
This move is a significant milestone. London, with its dense traffic, historic infrastructure, and complex road networks, presents one of the most demanding testing environments for autonomous vehicles. Successfully operating there would not only strengthen Waymo’s global credibility but could also accelerate adoption across other European cities.
In the U.S., Waymo continues to expand aggressively, offering services in multiple major metro areas and preparing to launch in Miami and Washington, D.C. It also secured permits in August to begin testing in New York City, a key step toward scaling its service in one of the world’s most challenging urban environments.
Does Waymo’s Expansion Warrant a Fresh Buy in Alphabet?
For now, perhaps not entirely on its own. While Waymo’s progress is impressive, it remains a minor contributor to the tech titans' overall financial picture. The autonomous rideshare market still faces steep regulatory, technological, and capital challenges before widespread adoption and eventual profitability can be achieved.
That said, the long-term potential is undeniable. If Waymo can successfully secure approvals in new regions and develop a reliable, scalable model, it could eventually become a significant revenue source within Alphabet’s extensive ecosystem. Much like YouTube or Google Cloud were in their early days.
Alphabet’s strength and pull for investors continue to lie solely in its core offerings. The company continues to fire on all cylinders across AI, cloud computing, and its core advertising engine. All while maintaining one of the most robust balance sheets in the market. With shares up significantly this year and valuations now reflecting much of that strength, investors may want to wait for pullbacks to build positions.
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