Alphabet raises full-year capex guidance to $195B-$205B
Alphabet lifted AI infrastructure spending plans and disclosed $811 billion in future commitments plus a $94 billion post-IPO SpaceX stake, as second-quarter revenue rose strongly and shares fell.
Alphabet raised its full-year capital expenditure forecast to $195 billion-$205 billion from $180 billion-$190 billion, citing strong demand for AI infrastructure, while disclosing $811 billion in future spending commitments as of the end of June, separate from capex. Second-quarter capex more than doubled year over year to $44.9 billion, contributing to negative free cash flow of about $5.85 billion-$5.9 billion, versus positive free cash flow in the prior quarter and roughly $25 billion in the same period a year earlier. Alphabet also said its SpaceX stake was worth $94 billion after SpaceX's IPO, with about $80 billion subject to a short-term lock-up agreement. The company reported about 24% second-quarter revenue growth to $119.7 billion-$119.8 billion and 82% cloud revenue growth to $24.8 billion, while shares fell as investors focused on the heavier investment burden.
- capital expenditure: Spending on long-term assets such as data centers, equipment, and infrastructure.
- free cash flow: Cash a company generates after operating expenses and capital spending needs are met.
- lock-up agreement: A temporary restriction on selling shares after an initial public offering.