As Waymo expands overseas, it remains a niche cash-burning business

Waymo is dominant in the U.S. and expanding overseas, but it remains immaterial in terms of revenue to parent Alphabet , which is pouring cash into its growth.

In Alphabet's third-quarter earnings report on Wednesday, the company said its Other Bets segment, which includes Waymo, generated $372 million in revenue, up 8% from a year earlier, and accounting for just 0.3% of total sales.

That revenue comes at a steep price. Operating loss in the Other Bets segment widened to $2.05 billion during the quarter from $1.43 billion a year ago. The unit also houses drug design research business Isomorphic, which is using Google's Gemini 4 Argon AI models.

CEO Sundar Pichai touted Waymo's expansion toward the end of his introductory remarks on the earnings call. The company has a commanding lead in the U.S. robotaxi market, where it faces emerging competition from Amazon's Zoox and Tesla . Waymo said in August that it plans to roll out robotaxi rides in Germany in 2027, marking its third international market and first in the EU.

"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 on the call.

Waymo's steepest competition on the global stage comes from Baidu's Apollo Go, which is based in China.

For years, Alphabet was able to operate Waymo as a side project while its core online ads business racked up tens of billions of dollars in annual profit and threw off mounds of cash. But with the company now investing heavily in artificial intelligence, free cash flow has turned negative and Wall Street has shown signs of concern.

Alphabet reported an earnings and revenue miss on Wednesday, sending the stock down almost 10% in extended trading. The company maintained its full-year capital expenditures forecast at between $195 billion and $205 billion, largely for AI infrastructure, and reported negative free cash flow of over $9 billion for the quarter.

Earlier this month, Waymo announced that it had closed a $5 ‌billion term loan, its first debt financing. In February, the robotaxi business announced that it had raised $16 billion at a $126 billion valuation in a funding round led by Alphabet that included support from Andreessen Horowitz, Fidelity, T. Rowe Price, Sequoia Capital, Kleiner Perkins and others.