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In 2022, investors discovered that Google and YouTube parent company Alphabet (NASDAQ:GOOGL,NASDAQ:GOOG,) stock wasn’t impervious to macroeconomic challenges.

It was a tough year for Alphabet, and 2023 might not be any easier for the company. Between regulatory problems and fierce competition from Microsoft (NASDAQ:MSFT), there’s no shortage of issues that could negatively pressure GOOG stock this year.

For years, financial traders may have assumed that Google is invincible, especially in its search engine business. Yet, there’s change afoot this year and as the old saying goes, the bigger they are, the harder they fall.

Alphabet is facing litigation that doesn’t have a known endpoint. Fighting battles in court can be quite expensive, and prospective investors can choose to avoid exposure to Alphabet’s legal woes by staying out of the trade completely.

Alphabet Is a Target of Federal Regulators

When regulators are paying close attention to a company, it usually isn’t a positive thing. So, it’s worrisome that, according to an analyst with Needham, Google is top-of-mind among people tasked with U.S. tech antitrust enforcement.

“In 100% of conversations, folks ,” observed Needham analyst Laura Martin after meeting with regulators, staff and other individuals in Washington, D.C. It’s a sign that Google will continue to face pushback for its alleged anticompetitive practices concerning online search and advertising.

As we’ve mentioned before, the U.S. Department of Justice (DOJ) has already launched multiple antitrust investigations into Alphabet. Plus, a judge just ruled that a federal antitrust lawsuit against Google . Thus, on the legal/regulatory front, it’s just one problem after another for Alphabet.

GOOG Stock Traders Should Consider the Threat from Microsoft

Meanwhile, although Microsoft isn’t eating Alphabet’s lunch in the search engine market yet, it’s definitely nibbling. Now that OpenAI’s ChatGPT generative artificial intelligence (AI) technology is , Google’s dominance appears to be slipping.

Here’s the evidence: Reportedly, the new, ChatGPT-enhanced Bing just . Apparently, Alphabet and Google were , and this allowed Microsoft to gain an early advantage.

Not that everybody has abandoned Google and started using Bing now. However, there’s still a lot of market share for Bing to potentially take away from Google. That’s just another issue for GOOG stock investors to worry about during the coming months.

Be Cautious with GOOG Stock

Microsoft was early and ambitious in adopting AI technology. This is unfortunate for Alphabet, which now has to play catch-up. It won’t happen overnight, but Google’s share of the search engine market could decline sharply.

In case that’s not enough, Alphabet’s stakeholders also need to consider the company’s legal troubles. Antitrust scrutiny from the government could cause long-term problems for Alphabet. Therefore, investors should take a cautious stance with GOOG stock, as there’s no need to expose oneself to the issues that Alphabet is facing in 2023.

On the date of publication, ¶¶Òõ×îаæ had long positions in GOOG and MSFT. ¶¶Òõ×îаæ did not have (either directly or indirectly) any other positions in the securities mentioned in this article.

The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.