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Alphabet Q2 beats expectations as AI infrastructure spending weighs on shares
Alphabet reported $44.9 billion of second-quarter capex and raised full-year guidance to $195 billion–$205 billion, alongside $119.8 billion in revenue, up 24% year over year.
Alphabet delivered a quarter of better-than-expected results with double-digit revenue growth, but investors focused on rising spending tied to expanding AI infrastructure, with the stock falling in after-hours trading, according to Yahoo Finance.
Alphabet said second-quarter capex totaled $44.9 billion, with most of the spending directed toward data centers, servers, and networking infrastructure to support AI capability expansion. The company also increased its full-year capex outlook to $195 billion to $205 billion, up from a prior forecast of $180 billion to $190 billion.
Management attributed the higher spending to an accelerated infrastructure buildout aimed at meeting robust customer demand, particularly for AI-powered services. However, concerns remain that the heavier investment could pressure margins in the near term.
Alphabet generated $119.8 billion in second-quarter revenue, a 24.0% year-over-year increase, with Search revenue above $63 billion. Yahoo Finance also highlighted that Google Cloud is seeing accelerated growth driven by AI adoption as Alphabet continues to invest at a faster pace.