Alphabet to Spend $175–$185B in 2026 Capex, Doubles from 2025; Shares React

Alphabet Inc (GOOGL) plans to spend $175–$185 billion on capital expenditures in 2026, roughly double its $91.4B 2025 level and a 2.5x increase from 2024, with Q4 capex hitting $27.9B. About 60% of the spend will go to servers, 40% to data centers and networking. The company emphasized maintaining compute capacity to outpace competition and meet AI-driven demand, noting supply, power, and land constraints remain significant. CEO Sundar Pichai said the cloud services backlog rose 55% QoQ to $240B and annual revenues surpassed $400B for the first time, with net income up 15% to $132.2B. Shares fell more than 6% after-hours, then gained over 2% during the earnings call before recovering slightly to -0.4% by close. The AI investment is expected to drive higher engagement on Google services and growth in Google Cloud, with AI search use rising and business spending on Cloud products up 14% year-over-year.