Alphabet Cloud Revenue Doubles Amid Increased Capital Expenditure and Rising Debt

Alphabet (GOOGL) reported significant growth in its Google Cloud division, which saw revenue increase by 103% to $30.7 billion this quarter. This growth was bolstered by the sale of custom AI chips (TPUs) to external customers. However, the company's aggressive investment in data centers and AI infrastructure led to a negative free cash flow for the quarter, with capital expenditure projected between $195 billion and $205 billion for the year. While operating income grew by 30%, Alphabet faces challenges including rising long-term debt—now approximately $125 billion—and a deceleration in Google Services revenue growth. The market reacted negatively to these financial shifts, with the stock falling over 10% following the report. Investors are now weighing the massive backlog of cloud contracts against the high costs of maintaining Alphabet's diverse technological ventures.

By The Rule Breakers Team · Motley Fool · October 29, 2026, 16:31 UTC

Tickers: $GOOGL

Topics: AI Chips Capital Expenditure Cloud Computing Quarterly Earnings

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