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Google’s AI spending has rapidly transformed the group from an asset-light business into a capital-intensive one.
The company said free cash flow for the three-month period to the end of June turned to minus $5.9bn as it raised its spending forecast for data centres and other AI hardware.
Chief financial officer Anat Ashkenazi said capital expenditures in 2026 would be $195bn-$205bn, up from previous guidance of $180bn-$190bn. The stock dipped about 3.5 per cent in after-hours trading.
Google also reported accelerating revenues at its cloud unt, which reported 82 per cent growth from a year earlier to $24.8bn in the period. Its core search advertising business grew 17 per cent year on year to $63.3bn.
The two business lines helped power total revenue to $120bn, from $96.4bn a year ago, beating the analysts’ average estimates of $117bn, Google’s parent company Alphabet said yesterday.
Integrated approach: Google has gained ground in the AI race thanks to a “full-stack” strategy that combines its own chips, data centres, frontier models and consumer products.
It is under pressure to release its latest flagship model, as competitors announce advances. Read the full story.
