Alphabet’s $180 billion-$190 billion 2026 capex plan may accelerate AI monetization, per Morgan Stanley analysis.
Alphabet’s (GOOGL) aggressive AI spending, projected at $180 billion to $190 billion for 2026, has raised investor concerns over margin pressure. The company previously cited “unprecedented” demand for AI compute as the driver behind the elevated capex, with 2027 spending expected to rise further.
Morgan Stanley’s latest research note reframes the narrative, highlighting a high-priced compute-rental deal with SpaceX as evidence of Alphabet’s push to monetize AI capacity faster than markets anticipated. The deal, estimated at $50 per watt, signals confidence in generating returns from AI investments.
Investors remain cautious about the scale of Alphabet’s AI expenditures, but the bank argues the spending could indicate a forming growth engine rather than a pure cost burden.