Alphabet shares fell 4.5% in afternoon trading after reports said the company has delayed the release of its flagship Gemini 3.5 Pro AI model by several months. The stock finished at $354.64, down 4.4% from the previous close, as investors reacted to another setback in Google’s AI push.
The market move matters because Gemini 3.5 Pro was supposed to show whether Google could keep pace in enterprise AI. Alphabet is still up 12.9% this year, but the latest drop came just 17 days after the shares rose 5% when they officially joined the Dow Jones Industrial Average, a reminder that the market is rewarding the company while also punishing signs that its AI roadmap is slipping.
Gemini 3.5 Pro was first announced at the Google I/O developer conference in May, and Alphabet had been leaning on it as a key step toward stronger software coding performance. The model reportedly fell short of internal expectations in that area, prompting the company to take more time before a wider release. That delay leaves investors with a simple question: when will Google be ready to put the model in front of consumers?
Google is not treating the project as finished. A company spokesperson said the model is still being tested with partners and the U.S. government, but the company has not given a firm consumer rollout date. That is the friction point inside the story: a model that is important enough to delay for months is still moving through tests, even after it missed the standard Google set for itself.
The setback lands at a moment when rivals such as OpenAI, Anthropic and Meta have already pushed more competitive models into view. Alphabet’s shares have also been unusually calm over the past year, with only four moves greater than 5%, so a 4.5% drop stands out. For now, the next important milestone is not a launch event but a date, and Google has not said when that will come.
