Google’s parent company is the latest in a string of U.S. tech giants to channel more money into data centers to bolster its artificial intelligence strategy.
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Alphabet executives said on its earnings call Tuesday that the company intends to invest $75B in capital expenditures in 2025 focused on growing its AI business.
The funds will largely be put toward “technical infrastructure, primarily for servers, followed by data centers and networking,” Alphabet CEO Sundar Pichai said on the call.
The amount is $17B more than Wall Street projected for the year, Reuters reported. Financial analysts estimated a $58B capex spend from Alphabet this year, up from the $52.5B it invested in 2024.
It comes as Alphabet’s largest competitors are also upping their capital expenditures in data centers and other AI infrastructure, even amid concerns around Chinese startup DeepSeek’s new AI model, which the company claims was trained using far less money and computing power than U.S. models.
Meta plans to increase its capex to between $60B and $65B in 2025, its executives said on the company’s earnings call last Wednesday, citing generative AI and its core business as driving forces behind the increase.
Microsoft plans to invest $80B in capex in its fiscal year 2025 on constructing data centers that can handle AI capabilities, CNBC reported last month.
On Tuesday’s call, Alphabet's Pichai sought to tamp down the tech industry’s concerns around DeepSeek. He said the ratio of the type of computing used to train AI models versus the type of “inference” computing used for customer-facing AI applications has already been shifting toward the latter. He said this trend is “good” and would likely be accelerated by the DeepSeek model.
“Part of the reason we are so excited about the AI opportunity is we know we can drive extraordinary use cases because the cost of actually using it is going to keep coming down, which will make more use cases feasible,” Pichai said. “And that’s the opportunity space. It’s as big as it comes. And that’s why you’re seeing us invest to meet that moment.”
Alphabet broke ground on 11 new cloud regions and data center campuses in 2024, it said on the call. Its fourth-quarter capex was $14B, which was primarily spent on technical infrastructure.
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