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Today: April 29, 2025
Today: April 29, 2025

Alphabet CEO reaffirms planned $75 billion capital spending in 2025

Artificial Intelligence (AI) Action Summit in Paris
April 09, 2025
Reuters - Reuters

Las Vegas (Reuters) -Alphabet reiterated on Wednesday it would spend about $75 billion this year to build out data center capacity, doubling down on its generative AI bet even as the payoff remains unclear and a global trade war threatens to raise costs.

The investment would fund the chips and servers needed to burnish its core offerings, including Search, while supporting the development of AI services such as its Gemini model, CEO Sundar Pichai said at the annual conference for Google's cloud computing unit.

"The opportunity with AI is as big as it gets," he said, adding the investments would also benefit the company's enterprise customers.

"Getting advances into the hands of both consumers and enterprises is something we are really focused on."

Alphabet's shares closed nearly 10% higher on Wednesday amid a big upward swing in markets after U.S. President Donald Trump said he would temporarily lower the hefty duties he had just imposed on dozens of countries, while further ramping up tariff pressure on China.

Alphabet had outlined plans for its $75 billion outlay in February. The target was 29% higher than what Wall Street analysts had expected at the time.

Big Tech companies are pouring hundreds of billions of dollars to build artificial intelligence infrastructure in the country, but investors have been getting increasingly restless over the massive investments, demanding better returns.

Rival Microsoft's president of cloud operations and innovation, Noelle Walsh, said in a LinkedIn post on Tuesday, "This year, Microsoft is on track to spend more than $80B to continue building out our datacenter infrastructure and these investments are informed by near-term and long-term demand signals."

Meta Platforms has said that the company would spend as much as $65 billion this year to expand its AI infrastructure.

Investments in AI have surged since OpenAI launched ChatGPT in 2022. Businesses are competing to dominate generative AI technology, in a bid to further diversify their revenue streams and enhance products.

(Reporting by Deborah Sophia in Bengaluru and Kenrick Cai in Las Vegas, additional reporting by Jaspreet Singh in Bengaluru; Editing by Alan Barona)

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