Alphabet is planning to drop $175-185 billion on capex in 2026, almost double the $91.4 billion it spent in 2025. It’s the hardware cheque for the AI arms race - data centers, servers, power - and CEO Sundar Pichai admits the scale is keeping him up at night. Investors liked the numbers and hated them, all in one trading session.
AI spending spree: This is the infrastructure side of winning AI. Alphabet’s Q4 capex was $27.9B, and the company says it’ll stay in a supply-constrained mode as it races to build capacity.
Is it time to freak out? Not yet, but don’t pretend this is risk-free. The gamble is obvious: spend massively now, scale compute later, and hope demand and efficiency catch up before the bill comes due. Power, land, chip supply, and construction timelines are real bottlenecks. Pichai says the company expects to be supply-constrained through the year - translation: slower builds, higher costs, and lots of juggling.
That said, Alphabet isn’t blindly burning cash. Revenue is growing, search and services are pulling their weight, and customers are already using Google’s AI tools. Meta just rolled out a similar capex ramp, so this is industry-wide, not a solo meltdown. The math: big infrastructure can be a moat if you can actually deploy it and monetize it. If you’re an investor, tech exec, or AI founder, treat this as a long-term capacity play with short-term execution risk. Exciting? Yes. Safe? No.
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