Alphabet Selloff Sends Nasdaq Futures Lower as Earnings Disappoint

U.S. stock futures declined as investors assessed a fresh wave of corporate earnings, with Alphabet's disappointing third-quarter results weighing heavily on technology shares. Nasdaq-100 futures fell 1%, S&P 500 futures slipped 0.2%, and Dow Jones Industrial Average futures hovered near unchanged as markets reacted to company results and the Federal Reserve's latest interest rate decision.

Alphabet shares dropped 10% in premarket trading after the Google parent missed analysts' expectations for adjusted earnings per share and revenue. The company also reported negative free cash flow of $9.07 billion and maintained its full-year capital expenditure forecast of $195 billion to $205 billion.

Microsoft shares moved in the opposite direction, rising 2.6% before the opening bell. According to LSEG data, growth in its Azure cloud infrastructure business helped the software company exceed expectations for both revenue and earnings in its fiscal first quarter.

Companies providing cloud infrastructure capacity to major technology firms fell as Microsoft's lower-than-expected capital expenditure figure suggested that data center capacity could take longer to reach infrastructure partners. The developments came as investors reassessed artificial intelligence-related stocks following a difficult period for much of October.

Shares of semiconductor and memory-focused exchange-traded funds had struggled for most of the month before recovering in recent sessions. Investors also considered the implications of the Federal Reserve's decision to maintain its benchmark interest rate range.

The Federal Reserve held its benchmark interest rate between 3.75% and 4% on Wednesday, following a quarter-percentage-point increase in September. Policymakers said inflation remained elevated and indicated they wanted to assess additional economic information before taking further action.

Daniel Siluk, head of global short duration and liquidity at Janus Henderson Investors, characterized the decision as a cautious approach rather than a definitive change in monetary policy.

"The door remains open to further tightening, but the Committee appears willing to wait for incoming data to validate the need for additional action," said Daniel Siluk, head of global short duration and liquidity at Janus Henderson Investors.

Siluk said the decision could be viewed as slightly dovish at the margin, but argued that patience was a more appropriate interpretation than a move away from the possibility of further tightening.

"The good thing is, in terms of supply chain, that has really become better than it was a year or two years ago," said Thomas Toepfer, Airbus chief financial officer, speaking to CNBC about the aircraft manufacturer's production outlook.

Toepfer said Airbus had the materials available in its factories to support its planned fourth-quarter deliveries. The manufacturer faces supply chain constraints, particularly shortages of Pratt & Whitney engines, as well as quality issues that have slowed aircraft deliveries.

Airbus shares rose as much as 2.3% after the company reported a mixed third quarter. Revenue reached 17.5 billion euros, equivalent to $19.5 billion, below FactSet expectations of 18.1 billion euros, while adjusted earnings before interest and tax came in just under 1.8 billion euros, exceeding the forecast of 1.75 billion euros.

The company reaffirmed its target of delivering 870 aircraft in 2026, which would exceed its previous record of 863 deliveries in 2019. Achieving that goal requires 323 aircraft deliveries in the fourth quarter, according to the company's stated target.

Caterpillar shares fell 9% despite the industrial equipment manufacturer exceeding third-quarter earnings and revenue expectations. The company reported adjusted earnings of $7.20 per share and revenue of $20.68 billion, compared with analyst forecasts of $7.08 per share and $20.55 billion in revenue, according to LSEG.

Sales in Caterpillar's construction industries business came in slightly below expectations, weighing on the shares despite the company's overall earnings beat.

Shell shares climbed 3% to an all-time high in morning trading in London after the energy company reported stronger-than-expected third-quarter earnings. Adjusted earnings increased to $10.81 billion from $5.43 billion a year earlier, surpassing the $9.92 billion consensus estimate compiled by LSEG.

Shell also reported record refining margins and announced that it would increase its quarterly share buyback program to $5 billion from £3 billion. The company cited elevated commodity prices and tight global supplies of refined products among the factors supporting its results.

Volkswagen reported an operating loss of nearly 5.9 billion euros, equivalent to $6.6 billion, for the third quarter as weakness in China and U.S. tariff costs pressured the German automaker. Revenue fell 6.3% to 75.3 billion euros, while special items totaled 8.7 billion euros.

The company attributed most of those special items to write-downs, including 6.4 billion euros related to Porsche goodwill and approximately 1 billion euros in assets in China, alongside costs associated with the planned sale of its Osnabrück plant.

Volkswagen Chief Financial and Chief Operating Officer Arno Antlitz said the nine-month results highlighted the urgency of the company's restructuring efforts.

"The nine-month results make one thing clear: We cannot afford to lose any time and must act quickly and decisively," said Arno Antlitz, Volkswagen's chief financial and chief operating officer.

Antlitz identified U.S. tariffs, a shrinking Chinese market, and intensifying competition in Europe as factors affecting the company's performance. He also said Volkswagen's operating return on sales before special items stood at 3.8% after nine months, a level he considered insufficient to sustain strong investment in the company's future.

Volkswagen has announced plans to cut 100,000 jobs as part of its restructuring program. Its shares traded below the flatline after the opening bell and had fallen 34% so far in 2026. The company forecast full-year revenue of approximately 315 billion euros.

Across the market, investors continued to weigh the contrasting performance of technology, industrial, energy, and automotive companies as earnings results highlighted differences in demand, operating costs, and capital investment plans.