Google Takes Verizon’s Place in Dow Jones Industrial Average

At a glance:

• Alphabet Inc. will replace Verizon in the Dow Jones Industrial Average effective June 29.
• This marks the first change to the index since 2024, when Dow and Intel were swapped for Nvidia and Sherwin‑Williams.
• Investors holding the State Street SPDR Dow Jones Industrial Average ETF or the ProShares UltraPro Dow30 will now gain indirect exposure to Google.

What happened

S&P Dow Jones Indices announced that on June 29 Alphabet, the parent company of Google, will be added to the Dow Jones Industrial Average while Verizon will be removed. This adjustment is the first alteration to the index since 2024, when the chemical company Dow (no relation to the index) and Intel were taken out to make room for Nvidia and the paint maker Sherwin‑Williams. The index committee said the change aims to expose the average to market dynamism rather than simply compile a list of historically important firms.

CNBC reported that the DJIA is seeking to reflect activity tied to AI, cloud computing, and digital advertising, sectors where Alphabet is a major player. By contrast, the 2024 swap added a paint company, which the article notes is less scintillating from a technology perspective. The stated goal is to keep the benchmark responsive to evolving market trends.

Why it matters

The Dow Jones Industrial Average remains a highly selective club with only 30 constituents, and inclusion is viewed as a stamp of blue‑chip approval that can carry more prestige than membership in the broader S&P 500, which lists 500 companies. Despite its stature, the index has no formal rules for admission, making decisions appear arbitrary to observers. This lack of clear criteria means that changes can reflect subjective judgments about sector relevance.

Because the DJIA is weighted by share price rather than market capitalization, a high‑priced stock such as Goldman Sachs can swing the index disproportionately. As of the article’s writing, one share of Goldman Sachs costs $1,089.29, whereas a share of Alphabet is priced at $348.17, illustrating how price weighting influences the index’s movements.

Impact on investors

The change will automatically flow into popular Dow‑linked exchange‑traded funds. Holders of the State Street SPDR Dow Jones Industrial Average ETF and the leveraged ProShares UltraPro Dow30 will soon find Alphabet shares representing a portion of their portfolios, even if they did not deliberately buy Google stock. This passive inclusion means that any investor in these ETFs gains exposure to Google’s earnings and price movements without a direct purchase.

Following the announcement, Alphabet’s shares rose about 1.7% in after‑hours trading, reflecting investor optimism about the Dow inclusion. For retail investors who gain exposure through these ETFs, the shift provides an indirect way to participate in Google’s growth without purchasing the stock directly. Analysts note that the added visibility could also boost liquidity and attract further institutional interest in Alphabet’s stock.