MW Google has been crushing it with AI this year in this overlooked way

By William Gavin

Waymo, the Alphabet-backed robotaxi startup, has been on a tear. Soon it could be worth $100 billion.

Waymo, a robotaxi startup backed by Alphabet, is set to be the dominant player in the industry through at least 2032, according to projections from Morgan Stanley.

Waymo, a startup working to launch driverless ride-hailing around the world, is set to join the $100 billion club. It's another sign of Alphabet's dominance this year.

The Alphabet-backed $(GOOGL)$ robotaxi company is in talks to raise more than $15 billion at a valuation of as much as $110 billion, Bloomberg News reported on Tuesday. It last raised money in October 2024 in a round that valued it at more than $45 billion.

Alphabet led that earlier round and is participating in the talks along with external investors, according to Bloomberg. Representatives for Waymo and Alphabet did not immediately respond to requests for comment.

Waymo, which was spun out of Google's self-driving-car division in 2016, is the only company in the U.S. operating a commercial robotaxi service without safety monitors. Its main rival, Tesla $(TSLA)$, plans to remove in-vehicle attendants from its commercial service in Austin, Texas, by the end of the month.

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Although Waymo has been known to move slowly, the company has recently picked up the pace. That's because it has more experience testing its vehicles and has been able to collect more data to train its technology, which it says is much safer than human drivers.

The company says it has carried out more than 14 million trips so far this year, putting it on pace to end the year with more than 20 million trips performed since 2020. Waymo said it could serve more than 1 million fully autonomous rides every week by the end of 2026.

Also read: How Google could follow Nvidia to become the next $5 trillion company

In addition to the five cities it currently offers rides in, which include Los Angeles and Phoenix, Waymo has started testing fully autonomous vehicles in another five, including Miami and Orlando. In November, Waymo said it would be the first in the U.S. to offer driverless trips on freeways without a safety monitor.

In total, the company has started laying the foundation for ride-hailing in more than 20 cities in 2026. London and Tokyo are Waymo's first international targets.

Despite the growth, Waymo isn't expected to meaningfully contribute to Google's financials until around 2027 or 2028, Alphabet CEO Sundar Pichai told employees in November, according to CNBC's report on Tuesday. Alphabet is expected to report a $4.98 billion loss this year on its "other bets" division, which includes Waymo, according to the FactSet consensus.

By 2032, Waymo is expected to remain the dominant player in the autonomous-rideshare business, according to Morgan Stanley's projections. By then, Waymo could operate 34% of all autonomous-vehicle trips. Tesla and Uber Technologies (UBER) could be the next-largest providers in the U.S., capturing 25% and 22% of the market, respectively, according to Morgan Stanley.

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That's good news for Alphabet's investors, who have benefited from the stock's 59% year-to-date gain - a performance that leads the group of megacap tech stocks known as the "Magnificent Seven." That rally has largely been driven by improved sentiment toward Alphabet's chatbot efforts, its renewed momentum in the cloud and traction with its custom chips.

Analysts at J.P. Morgan say the company is still poised to be one of the best ways to play the artificial-intelligence trade, pointing to its full-stack AI ecosystem.

Google's latest AI chatbot is at the top of leaderboards and has reached more than 650 million monthly active users, while Google Cloud is set to continue benefiting from enterprise demand for AI compute, J.P. Morgan said in a note last week. Alphabet's search business has also remained strong, despite fears that AI would disrupt Google's dominant offering.

-William Gavin

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December 17, 2025 10:27 ET (15:27 GMT)

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