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Alphabet’s free cash flow sinks further, Q3 capex expectations miss in worrying sign for AI trade
Google Cloud revenue more than doubled, but the company said AI infrastructure spending pushed free cash flow to negative $9.07 billion.
- Alphabet shares fell 8% in after-hours trading on Wednesday after the company reported third quarter revenue of $127.6 billion, missing the $127.8 billion analyst consensus forecast.
- Earnings per share represented a much bigger miss, coming in at $2.12 versus the $3.01 analyst outlook, though total revenue increased 25% year-over-year, marking 13 consecutive quarters of double-digit growth.
- Google Cloud revenue surged 103% to $30.7 billion, while YouTube ad revenue grew 9% to hit $11.2 billion; Alphabet surpassed 150 million YouTube Music and Premium subscribers globally.
- CEO Sundar Pichai called the July-to-September period a "strong quarter," noting Gemini AI reached 1 billion users, making it "the fastest-growing product in Google's history." Gemini 4 Argon and Carbon models remain at the frontier.
- Along with Big Tech peers Meta, Microsoft, Nvidia and Amazon, Alphabet faces mounting scrutiny from Wall Street as investors demand returns on massive AI infrastructure spending.
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Alphabet's Price-to-Fundamentals Mismatch Just Got Better as Institutions Sour on Capex
The post Alphabet’s Price-to-Fundamentals Mismatch Just Got Better as Institutions Sour on Capex appeared first on 24/7 Wall St.. Alphabet (NASDAQ:GOOGL) delivered a Q3 2026 earnings report that focused the debate over its spending. Alphabet spent $51.36B on capex in the quarter. It also held its 2026 spending plan steady and flagged a bigger 2027, and institutions soured on the plan after the report. Institutions saw cash burn. I saw a full-sta…
·Lakewood, United States
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Google's mother Alphabet pumps vast amounts of money into the expansion of data centers. This pushed free cash flow into the negative area for the second time in a row. Investors are increasingly concerned that the technology group could take over.
·Vienna, Austria
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Coverage Details
Total News Sources201
Leaning Left33Leaning Right33Center51Last UpdatedBias Distribution44% Center
Bias Distribution
- 44% of the sources are Center
44% Center
L 28%
C 44%
R 28%
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