The bill for Google’s AI spending spree is coming due.
Google said Wednesday that its free cash flow for the second quarter turned to negative $5.9 billion, as the company’s capital expenditures continue to rise.
It marks the first time the company has reported negative free cash flow in decades, per AlphaSense, a signal of how much money Google is spending on AI data centers and hardware.
Google, Amazon, Microsoft, and Meta had already planned to spend more than $700 billion in capex this year, and that number only seems to be ticking up.
Google said it now expects to spend $195 billion to $205 billion in capex for full-year 2026, up from its previous estimate of $180 billion to $190 billion.
Anat Ashkenazi, Google’s chief financial officer, said the company expects capex spend to increase “significantly” in 2027.
On Wednesday, Tesla reported negative cash flow for the first time in more than two years, as Elon Musk’s company also ramps up spending on AI infrastructure.
There’s also a question about how far these dollars actually stretch compared to a year ago. Some analysts reckon there’s inflation due to higher costs of memory chips and other materials, which make it more expensive to build out capacity.
All things considered, investors probably expect Google’s cash flow to remain in the red for quite some time — even as the company continues to report strong revenue gains.
