<\/p>\n\n\n\n
Alphabet (NASDAQ:GOOGL) topped Wall Street expectations on both earnings and revenue for the fourth quarter of 2025, but its sharply higher-than-expected capital expenditure guidance for 2026 unsettled investors, sending shares lower in premarket U.S. trading on Thursday.<\/p>\n\n\n\n
The results come at a sensitive time for technology stocks, with the artificial intelligence trade under pressure amid concerns over lofty valuations, intensifying competition, and ballooning spending plans. Software and AI-linked names have faced heavy rotation recently, as investors reassess the near-term payoff from massive investments in data centers, chips, and generative AI platforms.<\/p>\n\n\n\n
Capex outlook dominates reaction<\/strong><\/p>\n\n\n\n Alphabet said it expects capital expenditures of between $175 billion and $185 billion in 2026, a dramatic jump from 2025 levels and far above the Street\u2019s estimate of about $119.5 billion. Like its megacap peers, the Google parent is accelerating spending to expand AI infrastructure, develop advanced models, and scale its cloud and platform capabilities.<\/p>\n\n\n\n While the long-term AI opportunity remains intact, the scale of the planned outlays reinforced investor concerns about margin pressure and returns on capital in the near term.<\/p>\n\n\n\n Strong stock performance heading into earnings<\/strong><\/p>\n\n\n\n Alphabet entered earnings season as the standout performer among the \u201cMagnificent Seven.\u201d Its Class A shares surged 65.3% in 2025, the strongest gain in the group, and are already up another 8.5% year-to-date, comfortably outperforming both its megacap peers and the S&P 500.<\/p>\n\n\n\n Momentum was especially strong late last year, with shares jumping 28.8% in the final three months of 2025. That rally was driven by enthusiasm around Alphabet\u2019s latest Gemini AI model and a high-profile partnership with Apple to help power AI features on the iPhone, including enhancements to Siri.<\/p>\n\n\n\n Quarterly results beat expectations<\/strong><\/p>\n\n\n\n For the fourth quarter of 2025, Alphabet reported earnings of $2.82 per share on revenue of $113.83 billion, beating analyst expectations of $2.64 per share and $111.12 billion in revenue. The company\u2019s prior quarter had already marked its first-ever $100 billion revenue quarter, underscoring the scale of its growth.<\/p>\n\n\n\n Operating income rose 16% year-on-year to $35.93 billion, reflecting continued strength across its core businesses despite heavy investment.<\/p>\n\n\n\n Cloud and core services both deliver<\/strong><\/p>\n\n\n\n Investor focus remained firmly on Google Cloud, which houses much of Alphabet\u2019s AI infrastructure and generative AI offerings. The segment posted a 48% year-on-year surge in revenue to $17.66 billion, reinforcing its status as one of Alphabet\u2019s fastest-growing divisions.<\/p>\n\n\n\n Meanwhile, the core Google Services business \u2014 encompassing Search, YouTube, advertising, Android, Chrome, and Maps \u2014 continued to deliver solid performance. Revenue in this segment rose 14% year-on-year to $95.86 billion, highlighting the durability of Alphabet\u2019s advertising and platform ecosystem even as AI reshapes the competitive landscape.<\/p>\n\n\n\n Other Bets remain a drag<\/strong><\/p>\n\n\n\n Alphabet\u2019s Other Bets segment, which includes autonomous driving, healthcare initiatives, and internet services, generated $370 million in revenue, down 7.5% year-on-year. While strategically important, the segment remains small relative to the group and continues to weigh on overall growth.<\/p>\n\n\n\n Overall, Alphabet\u2019s earnings strength underscored its operational momentum, but the sheer scale of its planned AI investment for 2026 has shifted investor focus squarely toward spending discipline and long-term returns.<\/p>\n","protected":false},"excerpt":{"rendered":" Alphabet (NASDAQ:GOOGL) topped Wall Street expectations on both earnings and revenue for the fourth quarter of 2025, but its sharply higher-than-expected capital expenditure guidance for 2026 unsettled investors, sending shares lower in premarket U.S. trading on Thursday. The results come at a sensitive time for technology stocks, with the artificial intelligence trade under pressure amid …<\/p>\n","protected":false},"author":9,"featured_media":69057,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[6827,49,39,36],"tags":[],"class_list":["post-123462","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-daily-economic-reports","category-economic-reports","category-global-stock-markets","category-market-updates"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/123462","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=123462"}],"version-history":[{"count":1,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/123462\/revisions"}],"predecessor-version":[{"id":123463,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/123462\/revisions\/123463"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/69057"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=123462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=123462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=123462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}