Home / Business and Economy / Waymo Valued at $200B+, Analysts Urge Alphabet Breakup
Waymo Valued at $200B+, Analysts Urge Alphabet Breakup
5 Aug
Summary
- Waymo, Alphabet's self-driving unit, could be worth over $200B
- Analysts recommend Alphabet break up to unlock shareholder value
- Waymo's revenue could exceed $700M in 2026 from a 3,500-vehicle fleet
According to a recent note from analysts at DA Davidson, Alphabet's Waymo self-driving unit could be worth more than $200 billion as a standalone company. The analysts draw comparisons to Tesla's robotaxi ambitions and argue that a breakup of Alphabet would allow investors to own the businesses they actually want, such as top competitors to Netflix, AWS/Azure, Nvidia, OpenAI, The Trade Desk, and Tesla.
The analysts believe Waymo could generate over $700 million in revenue by 2026 from a 3,500-vehicle fleet, while much of Tesla's current $1 trillion valuation is "derived from Robotaxi," which has "trivial revenue." They also note that Waymo has "essentially validated" its prior-heavy autonomous driving stack, now operating more than 1,500 cars in four U.S. cities.
Despite maintaining a Neutral rating on Alphabet, the analysts say they would see the company as "the top mega cap pick if it proceeded with a complete break-up." They cite rising investor frustration over Alphabet's underperformance in Search, Cloud, and advertising relative to peers, and argue that the company's current multiple of 18x earnings could pressure the board to act.
