Jim Cramer reverses stance, now supports Alphabet's Waymo acquisition

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  Published in Stocks and Investing on Monday, February 2nd 2026 at 14:29 GMT by CNBC
      Locale: UNITED STATES

New York, NY - February 2nd, 2026 - CNBC's Jim Cramer publicly reversed his stance on Alphabet's autonomous driving subsidiary, Waymo, today, stating he now believes Alphabet should acquire the remaining stake in the company. This admission, made on "Squawk on the Street," represents a significant shift in perspective and potentially signals a broader re-evaluation of investment strategies within the increasingly competitive autonomous vehicle (AV) sector.

For years, Cramer had expressed skepticism about Waymo, viewing it as a costly venture that would drag down Alphabet's overall financial performance. He openly questioned the wisdom of Alphabet even owning Waymo, labeling it a potential "money pit." However, recent developments, including a significantly increased valuation and demonstrable progress in Waymo's technology and commercialization efforts, have prompted a complete about-face.

Bloomberg currently values Waymo at $53 billion. This valuation, a substantial increase from previous estimates, reflects growing confidence in Waymo's technological capabilities and its potential to disrupt the transportation industry. The increased valuation is driven by several factors, including expansion of Waymo One's ride-hailing service to more cities, successful partnerships with logistics companies, and advancements in the core autonomous driving software.

"I was wrong, and I'm admitting it," Cramer stated emphatically. "I thought it was ridiculous for Alphabet to ever buy Waymo. It's not. I now believe they should buy Waymo."

This isn't simply about one financial analyst changing his mind; it highlights a key turning point in the AV landscape. While several companies--including Tesla, Cruise, and Aurora--are vying for dominance, Waymo consistently ranks among the leaders in terms of technological sophistication. Its "Driver" system, relying heavily on lidar and advanced machine learning, has demonstrated impressive performance in diverse and challenging driving conditions.

Initially, concerns centered on Waymo's lack of immediate profitability and the massive capital investment required to develop and deploy autonomous vehicles. The high cost of sensors (particularly lidar), the complexities of software development, and the regulatory hurdles all contributed to the pessimistic outlook. However, as Waymo matures, these costs are beginning to come down, and the company is demonstrating a clearer path to commercial viability.

Acquiring full ownership of Waymo would provide Alphabet with several strategic advantages. Firstly, it would unlock significant financial upside as Waymo becomes increasingly profitable. Integrating Waymo's technology into other Alphabet subsidiaries, such as Google Maps and Waymo Via (the logistics arm), could create synergistic opportunities and new revenue streams. Secondly, it would solidify Alphabet's position as a frontrunner in the future of transportation, a market projected to be worth trillions of dollars in the coming decades.

The impact of a full acquisition extends beyond Alphabet's balance sheet. It would send a strong signal to investors that the AV market is maturing and that the long-term potential outweighs the short-term risks. It could also trigger a wave of consolidation within the industry, as other major players seek to acquire or merge with promising AV startups.

However, some analysts remain cautious. Concerns persist regarding the timeline for widespread autonomous vehicle adoption, the potential for unforeseen regulatory challenges, and the ethical implications of self-driving technology. The recent setbacks experienced by Cruise, including safety concerns and operational suspensions, serve as a reminder of the inherent risks involved. Nevertheless, Cramer's reversal, coupled with Waymo's positive trajectory, suggests a growing belief that the AV revolution is finally gaining momentum.

Ultimately, Jim Cramer's change of heart isn't just about one stock; it's about the evolving narrative surrounding autonomous vehicles. The industry is moving beyond the hype and entering a phase of practical implementation, and Waymo appears well-positioned to capitalize on this shift. Investors and industry observers will be closely watching Alphabet's next moves regarding Waymo, as they could well define the future of transportation.