Alphabet (GOOGL-US) Hires $1.85 Trillion in 2026 AI Infrastructure Spending, Doubling 2025 Outlay

Alphabet (GOOGL-US) announced in a post-market report that capital expenditures for 2026 are expected to reach $1.75T–$1.85T, more than double 2025 levels and far exceeding peer forecasts. The aggressive buildout follows a strong quarter with revenue and Google Cloud outperforming expectations, though the AI infrastructure ramp caused volatility, with the stock down as much as 7% before recovering slightly. Peers: Meta (META-US) projects 2026 spending of $1.15T–$1.35T; Microsoft (MSFT-US) is expected to see sequential declines; Amazon is forecast to add ~18% to 2025 levels, reaching $1.466T. Analysts caution as software sector value has fallen roughly 30% in three months amid concerns AI tools may displace some software. Within Alphabet, Google Cloud’s fourth-quarter pipeline hit $240B, up 55% year-over-year and 50% quarter-over-quarter, with cloud revenue up 48% YoY. The 2025 capital allocation is roughly 60% to servers and 40% to data centers and networking. AI applications like Gemini report 7.5B MAUs versus 6.5B in the prior quarter. Alphabet’s leadership underscores growth with a strategic partnership with Apple (AAPL-US) to enhance Siri using Gemini, with Apple selecting Google Cloud as its preferred provider. 高管s cite compute capacity as the primary driver, requiring doubling of service capacity every six months to meet escalating demand.