Alphabet raises 2026 capex to as much as $205 billion as Cloud revenue jumps 82%

Alphabet reported second-quarter 2026 revenue of $119.8 billion, up 24% from a year earlier, and raised its full-year capital-expenditure guidance to $195 billion to $205 billion, the company said in its earnings release.

The new spending range is up from the $180 billion to $190 billion Alphabet guided to earlier, and executives tied the increase to a supply-constrained market for AI infrastructure. Second-quarter capital spending alone was $44.9 billion, a sign of how much cash the search company is pouring into data centers and chips to keep pace with cloud demand.

Google Cloud was the standout. Revenue rose 82% to $24.8 billion, and Cloud operating income climbed to $8.8 billion from $2.8 billion a year earlier, per the results filed with the SEC. Cloud’s backlog of contracted but not-yet-recognized revenue grew to $514 billion, up from about $460 billion the prior quarter.

Google Services, the advertising engine, rose 15% to $94.5 billion, with Search up 17% to $63.3 billion. Consolidated operating income rose 30% to $40.8 billion, lifting operating margin two points to 34%.

Net income was $112.1 billion, but that figure is inflated: it included $99.0 billion in unrealized gains on equity investments, a mark-to-market swing that does not reflect operating performance. Diluted earnings were $9.11 a share, against $2.31 a year earlier.

Alphabet said nearly 90% of the Fortune 100 now uses Gemini Enterprise, that the Gemini app has 950 million monthly active users, and that its Gemini models process 22 billion API tokens per minute. “Our AI investments are redefining what’s possible across every part of our business,” Chief Executive Sundar Pichai said.

The capex jump is the number investors will scrutinize. Alphabet is betting that cloud and Gemini demand will absorb spending on this scale, and the backlog gives it cover, but the returns on this year’s build-out will not be clear for several quarters.