Google parent Alphabet just threw down the biggest bet in the AI infrastructure arms race. The company announced it expects to spend up to $185 billion on capital expenditures in 2026 - more than double its 2025 spending and surpassing every hyperscaler competitor. Despite beating earnings expectations across revenue, EPS, and cloud growth, Alphabet's stock dipped in after-hours trading Wednesday, revealing Wall Street's growing unease with AI's astronomical price tag. But Google's message is clear: it's willing to pay whatever it takes to win the infrastructure war that CEO Sundar Pichai says keeps him up at night.
Alphabet just reset the scoreboard for the AI infrastructure spending race, and it's making competitors look cautious by comparison. The Google parent announced Wednesday it expects 2026 capital expenditures between $175 billion and $185 billion - a forecast that would more than double its 2025 spending and establish a new high-water mark among hyperscale cloud providers.
The announcement came as Alphabet reported fourth-quarter results that beat Wall Street expectations on revenue, earnings per share, and cloud performance. Yet shares slipped in extended trading, reflecting investors' growing anxiety about AI spending even as companies race to build the infrastructure that could define the next decade of computing.
"With the projection, Alphabet is resetting the year's expectations for how it'll spend in 2026 and testing its favor with Wall Street," according to CNBC's reporting. The company had telegraphed "a significant increase" to capex back in October, but Wednesday's numbers still managed to surprise.
The forecast towers over competitors. Meta said last week it expects to spend between $115 billion and $135 billion in 2026 - which would nearly double last year's $72.2 billion but still falls short of Google's upper range. didn't provide a full-year forecast in its recent quarterly report, saying only that capex will "decrease on a sequential basis" this quarter after hitting $37.5 billion in the latest period. reports Thursday, with analysts projecting 2026 capex around $146.6 billion, according to FactSet.
