Alphabet plans $80 billion stock raise to finance vast AI infrastructure buildout
Alphabet will ask shareholders to authorise issuing up to $80 billion in new shares. The company says most of the proceeds will fund Google Cloud data centres and custom TPU chips. CFO Anat Ashkenazi said the spending is needed to 'build out a durable AI franchise'.
CNBC Top NewsAlphabet will table a resolution at its annual general meeting asking shareholders to authorise the issuance of up to $80 billion in new shares. CNBC reports that this represents the largest single share-authorisation in the company's history and the biggest operational equity raise across the tech sector this year.
Chief financial officer Anat Ashkenazi said the proceeds would primarily fund new hyperscale data centres for Google Cloud and the production of the seventh-generation TPU chips. Morgan Stanley analyst Brian Nowak wrote that the move 'signals an aggressive AI investment phase rather than capital discipline'. Ken Gawrelski of Wells Fargo projected total capital expenditure could exceed $105 billion in 2027.
Alphabet shares fell 1.8% in after-hours trading in New York amid investor concerns about share dilution. Bernstein analyst Mark Shmulik wrote that 'this will be the first year in which free-cash-flow takes second priority to the OpenAI competition'. The company added that the disclosure does not constitute investment advice.
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