Alphabet Raises 2026 Capex Guidance to $195-205B After Q2 Beat, Stock Falls

According to FactSet data, Alphabet posted second-quarter results that beat Wall Street expectations for revenue and earnings per share on July 23, yet its stock fell in after-hours trading. The company raised its 2026 capital expenditure guidance to between $195 billion and $205 billion, up from $180-190 billion, driven by AI infrastructure investments.

Alphabet recorded negative free cash flow for the first time since its 2004 IPO, as capital spending nearly doubled to $45 billion in Q2 year-over-year. Additionally, the company's net income gain of $99 billion was overwhelmingly attributable to unrealized investment gains on equity securities, primarily from an early SpaceX stake, raising concerns about the sustainability of AI spending returns.