Alphabet Q4 Revenue Miss Weighs on Shares Despite Cloud Capex Boost
Alphabet's fourth-quarter revenue fell short of expectations, triggering an 8% decline in its stock price.
Sales, excluding payouts, reached $81.6 billion, below the $82.8 billion consensus estimate. The company also announced a significant increase in 2025 capital expenditures to $75 billion, exceeding analysts' projections by a substantial margin. This investment is primarily allocated to data center expansion and infrastructure for artificial intelligence (AI).
Alphabet's cloud unit, a beneficiary of the AI boom, saw reduced growth with sales of approximately $12 billion in the quarter, missing estimates. Despite its progress, Google Cloud remains behind rivals Amazon.com and Microsoft in market size.
Investors are scrutinizing Alphabet's ability to sustain momentum across its businesses amid heightened spending on AI and intensifying competition.
In after-hours trading, Alphabet's stock dropped as low as $189.40, extending a decline from its $206.38 closing price. Despite the setback, the company's shares have gained 9% year-to-date.