Alphabet Hikes AI Capex to $1.85B; Broadcom & NVIDIA Surge on Semiconductor Demand

Alphabet parent company Alphabet Inc. (GOOGL-US) announced in February 2026 it will invest $1,750–$1,850 billion in 2026, roughly double 2025 and well above the $1.15 trillion market estimate. The increase, focused on AI servers, data centers, and infrastructure, reinforces strong forward-looking AI compute demand. The news sent Broadcom (AVGO-US) and NVIDIA (NVDA-US) higher in after-hours trading: AVGO +6%, NVDA +2%. Broadcom benefits from its role in manufacturing and designing Google TPU, while NVIDIA sees tailwinds from hyperscaler-driven GPU demand. Alphabet is scaling its TPU-based AI with the Gemini 3 model and expanding xPUs, a move expected to lift AI semiconductor valuations. Total cloud AI capex for 2026 is forecast to exceed $5 billion, though investors remain split as they balance AI return potential with capital expenditure pressure.