Alphabet's P/E is 14.8x. That is the lowest of its weekly readings over the last five years. If you stopped there, you would think the market had given up on Alphabet. Some of the drop is the price: the shares fell 13% on October 29, the day after the third-quarter report. Most of it is the earnings.
If you only read one thing
The short version: In the week of June 29, 2026, Alphabet traded at $359.91 and 27.5 times trailing earnings. Four weeks later, after its second-quarter report, it traded at $356.13 and 17.9 times. The price fell 1%. The P/E fell 35%. The difference is a $99.0 billion gain on Alphabet's stakes in SpaceX and Anthropic, booked in one quarter, outside its main business. On price-to-sales, which that gain does not touch, Alphabet is near the middle of its readings since July 2024 (as of October 29, 2026).
What happened to the earnings
P/E divides the share price by the last twelve months of diluted earnings per share. Alphabet's trailing EPS went from $10.81 at the end of 2025 to $13.11 in March 2026, $19.91 in June and $19.16 in September. Revenue grew about 17% over the same stretch. EPS grew 77%.
The jump came from below the operating line. Over the twelve months to September 2026, Alphabet earned $157.0 billion of operating income from Search, YouTube, Cloud and the rest. Its pretax income was $287.6 billion. Most of the $130.7 billion gap is unrealized gains on companies Alphabet owns pieces of: SpaceX, marked to its market price after its June listing, and Anthropic. The second quarter alone carried $99.0 billion of those gains.
Those gains are real accounting income. They are not income Alphabet earns again next quarter by selling ads. And now that SpaceX trades publicly, the mark moves every quarter in both directions: in the third quarter Alphabet booked an $8.7 billion loss on equity securities, and other income was negative $8.2 billion. The twelve-month total still carries the second quarter's gain.
What we show now
We keep the reported P/E. Adjusting earnings means picking which items count, and every adjusted number on the internet picks differently. So the P/E stays 14.8x, and its rank stays the lowest in five years.
What changed is the sentence next to it. Alphabet's page now reads:
> Alphabet's P/E of 14.8x is the lowest of its weekly readings over the last five years, but its recent earnings include a large one-time gain outside its main business. Its P/S is lower than 52% of its weekly readings since July 2024 (as of Oct 29, 2026).
We also dropped the "historically low" label above that sentence. A label that short can't carry the caveat, so a P/E with a large one-time item doesn't get one.
The second number is the one to check. Price-to-sales (7.4x, near its median of 7.7x) and EV/EBITDA (18.0x, below its median of 21.8x) both leave out investment gains. Our sales and EBITDA history for Alphabet starts in mid-2024, so those ranks cover about two years, not five. Read with those, Alphabet sits within its usual range, not at a five-year low. Our guide on when to use P/E, P/S or EV/EBITDA covers the tradeoffs.
The screener does the same. A P/E with a large one-time item still shows in the table, with a small marker, but it is left out of screens that rank by P/E percentile. Without that, Alphabet would top any screen for the lowest P/E against its own history, for the wrong reason.
How we spot it
We compare a company's pretax income with its operating income over the last twelve months, then compare that gap with the gap the company usually runs. Interest on debt is left out of both: it is a cost of financing that recurs, even when the debt is new. When the unusual part is more than a quarter of operating income, the P/E gets the note. Gains and losses both count. A large loss makes a P/E look higher than the business deserves, the mirror image of Alphabet.
We ran this across the nearly 1,000 stocks we cover and read the filings behind what it found. Banks and insurers don't report operating income, so they are never marked. The method is on our methodology page.
Who else has the same problem
Alphabet is not alone, and the cause is often the same company. As of October 29:
- Amazon: P/E 19.7x, the lowest of its five-year readings, after about $70 billion of Anthropic gains. On sales, higher than 63%.
- Zoom: P/E 9.1x, lower than 97%, after $2.7 billion of investment gains, mostly Anthropic. On sales, higher than 77%.
- Salesforce: P/E 20.9x, lower than 97%, after $4.2 billion of investment gains, mostly Anthropic. Here P/S agrees: it is lower than 91% of its readings.
What this means when you read a P/E
A P/E is two numbers. When it moves a lot, check which one moved. If the price is flat and the P/E fell by a third, the earnings changed, and the next question is whether they will repeat. For Alphabet, the answer for most of that $99 billion is no.
Alphabet's valuation page shows the P/E, its five-year band, and the sales and EBITDA readings next to it, updated weekly.