Even Google couldn't out-earn its AI spending this quarter

Google has reported negative free cash flow of $5.9 billion for the second quarter, a first in decades, driven by increased capital expenditures on AI infrastructure. The company has also raised its full-year 2026 capex forecast and anticipates further significant spending increases in 2027. This trend mirrors similar spending hikes by other tech giants, with rising costs for components like memory chips contributing to higher expenses.

• Google’s Q2 free cash flow was negative $5.9 billion, its first such report in decades.
• This negative cash flow is attributed to rising capital expenditures for AI data centers and hardware.
• Google has increased its full-year 2026 capex forecast to $195-$205 billion.
• The company expects capex spend to increase ‘significantly’ in 2027.
• Other major tech companies like Amazon, Microsoft, and Meta are also planning substantial capex increases.
• Rising costs for memory chips and other materials are contributing to higher infrastructure spending.
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