Alphabet's robotaxi arm Waymo is racing across America and heading overseas, but the price tag is enormous: the division housing Waymo lost $2.05 billion in a single quarter, according to CNBC's earnings report on Wednesday, October 28, 2026.
The numbers came straight from Alphabet's third-quarter earnings. Waymo sits inside the company's Other Bets segment, which pulled in just $372 million in revenue, up 8% from a year earlier. That is 0.3% of total sales. The operating loss widened from $1.43 billion a year ago. In plain terms, Alphabet is spending five dollars for every dollar this unit brings in.
Waymo's Expansion: 15 U.S. Cities and Counting
CEO Sundar Pichai defended the spending on the earnings call and pointed to real momentum on the ground.
«Waymo now operates in 15 major U.S. cities and just recently opened up service to the public in San Antonio, San Diego and Tampa with planned expansions into Canada, Germany, Singapore and Spain,» Pichai said.
That is genuine American ingenuity at work. A company born from Google's self-driving car project now gives riders fully autonomous trips in cities from Phoenix to San Francisco, and last week it started driverless service to and from the Las Vegas airport after launching airport runs in five other cities. Electrek reports Waymo now covers 15 U.S. metro areas and delivers more than 500,000 paid rides every week.
«Waymo is on a great trajectory,» Pichai said. «We have now driven more than 300 million fully autonomous miles.»
That figure matters. Compare it with Tesla's Robotaxi network, which says on its website it has completed about 3.8 million unsupervised miles. Waymo has a commanding lead in the U.S. robotaxi market, though competition is coming from Amazon's Zoox and from Tesla itself. Elon Musk said on Tesla's earnings call last week that Robotaxi should become a «meaningful» revenue contributor by the second half of 2027.
Why the Losses Are Getting Harder to Ignore
For years, Alphabet could treat Waymo as a side project. Its core online advertising business threw off tens of billions in annual profit and covered every experiment the company wanted to fund. That cushion is thinning.
Alphabet is now pouring money into artificial intelligence infrastructure, and the bill is coming due. The company reported negative free cash flow of more than $9 billion for the quarter and kept its full-year capital spending forecast at $195 billion to $205 billion, mostly for AI. Wall Street noticed. The company missed on both earnings and revenue, and the stock dropped almost 10% in after-hours trading.
There is also a debt milestone worth watching. Earlier this month, Waymo closed a $5 billion term loan, its first debt financing. In February, it raised $16 billion at a $126 billion valuation in a round led by Alphabet and backed by Andreessen Horowitz, Fidelity, T. Rowe Price, Sequoia Capital and Kleiner Perkins. When a company that once lived comfortably on its parent's cash starts borrowing, the free-spending days are getting a hard look.
Global Ambitions and Global Rivals
Waymo said in August it plans to launch robotaxi rides in Germany in 2027, its third international market and its first in the European Union. Canada, Singapore and Spain are also on the roadmap.
Abroad, the competition gets tougher. Baidu's Apollo Go, based in China, is Waymo's biggest rival on the world stage. One editorial analysis notes that regulatory hurdles in Europe may force Waymo to take on local investors, which could dilute Alphabet's control of the technology it built.
Back home, the robotaxi boom is also reshaping local markets. The Korea Daily reports that taxi operators in Los Angeles are fighting back by targeting trips Waymo does not serve, like tourist spots outside its operating zones and longer runs to San Diego and Santa Barbara. Free markets at work: competitors find the gaps and fill them.
Can Waymo Ever Pay Its Own Way?
The core question is whether robotaxis can turn from a prestige project into a real business. Alphabet's Other Bets segment also contains Isomorphic, a drug design research firm using Google's Gemini 4 Argon AI models, so the losses are not all Waymo's. But the trend line is clear: losses widened by more than $600 million in one year while revenue grew just 8%.
Scaling up a fleet takes factories, and BigGo Finance reports Waymo has a plan for 20,000 robotaxis through a Magna assembly line, with open questions about whether Hyundai can supply that volume or whether Waymo will have to build vehicles itself.
For now, Alphabet is betting that American engineering and a first-mover lead will win the robotaxi race the way Google won search. The company has the miles, the cities and the riders. What it does not yet have is a profit, and Wednesday's stock slide shows investors' patience is not unlimited.
FAQ
How much money did Waymo's division lose last quarter?
Alphabet's Other Bets segment, which includes Waymo, posted an operating loss of $2.05 billion in the third quarter of 2026, up from $1.43 billion a year earlier, according to CNBC.
How many cities does Waymo operate in?
Waymo operates in 15 major U.S. cities, including recent public launches in San Antonio, San Diego and Tampa, with planned expansions into Canada, Germany, Singapore and Spain.
How does Waymo compare to Tesla's Robotaxi?
Pichai said Waymo has driven more than 300 million fully autonomous miles. Tesla says its Robotaxi network has completed about 3.8 million unsupervised miles, and Musk expects Robotaxi to be a meaningful revenue contributor by the second half of 2027.