Key Takeaways
- NHTSA opened a recall query into 2,895 Waymo vehicles to test whether the software fix behind its December 2025 recall actually worked. Most of the reported incidents came after the update was completed on November 17, 2025.
- Waymo barely registers in Alphabet’s earnings: Other Bets lost $2.05 billion in Q3, about 5% of Alphabet’s $40.58 billion in operating income.
- The longer-term risk is to the expansion plans behind Waymo’s $126 billion valuation: it said it was laying the groundwork for more than 20 additional cities in 2026, with Tokyo’s commercial launch targeted for 2027.
- A new recall or school-zone limits could also affect Uber, which books Waymo rides in Austin and Atlanta.
Alphabet (GOOGL)’s Waymo is back under federal review over school buses, and this time the question is whether its fix ever worked. The National Highway Traffic Safety Administration (NHTSA) has opened a recall query covering 2,895 Waymo vehicles, Reuters reported on Monday, November 9. NHTSA’s records show the query opened on November 6, replacing a preliminary investigation that began in October 2025.
The case also reaches Uber (UBER). Waymo’s robotaxis in Austin and Atlanta, where school districts reported the violations last year, are booked through Uber’s app.
Waymo Said It Fixed This a Year Ago
Waymo recalled 3,067 vehicles in December 2025 after its cars drove past stopped school buses with red lights flashing and stop arms extended. It said a software update completed on November 17, 2025, had solved the problem. NHTSA now says most of the reported incidents came after that date. Austin’s school district counted 20 illegal passes by December 1, 2025, alone, and said Waymo turned down its request to pause service during school bus pickup and drop-off hours.
The query will test whether the remedy was adequate and what caused the later incidents. A recall query isn’t a recall, but it can lead to one.
Waymo’s Scale Within Alphabet
Measured against Alphabet’s profits, Waymo barely registers. Other Bets, the segment that houses it, brought in $0.37 billion of revenue in the third quarter, while Alphabet as a whole earned $40.58 billion of operating income.
Other Bets lost $2.05 billion in the quarter, about 5% of that operating income. The cost of any further remedy remains unknown while NHTSA works out why the violations continued.
The valuation is what’s exposed. Investors valued Waymo at $126 billion in February. It operates in 15 U.S. cities and said it was laying the groundwork for more than 20 additional cities in 2026, including London and Tokyo, though Tokyo’s commercial launch is targeted for 2027. Approval rules vary by jurisdiction, and continued school-bus violations could bring more scrutiny to Waymo’s expansion.
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What Waymo Still Hasn’t Explained
The open question is why the violations kept happening after the update. If NHTSA finds a narrow software gap, another over-the-air fix could address it, potentially limiting disruption to the rollout. If it finds the system still can’t reliably handle school-bus signals, a new recall becomes likely, and districts get a stronger case for the time-of-day limits Austin already asked for. That second outcome is the one that would reach Uber’s robotaxi business in Austin and Atlanta, and Waymo’s $126 billion price tag.
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