- Alphabet reports Q3 2026 results after the bell Wednesday. LSEG consensus calls for $3.02 EPS and $128.2 billion revenue, up 25% from a year earlier.
- Analysts expect Q3 capex of $55.2 billion, up 130% from a year earlier, according to FactSet. Annual capex is expected to top $200 billion before exceeding $300 billion in 2027.
- Alphabet raised its FY26 capex forecast to $195 billion to $205 billion in July and reported negative free cash flow for the first time.
- Google Cloud revenue is projected to grow 90% to $28.7 billion, as Google takes market share from Amazon Web Services and Microsoft Azure.
- Analysts see Q3 negative free cash flow of $2.27 billion, with the gap expected to widen in each of the next four quarters.
- Shares have dropped in five of the past six sessions and are down about 7% in October heading into the report.
- Seeking Alpha frames the report as a test of the $200 billion AI capex plan, with $359.44 as key resistance and $300.44 as key support.
- Commentary centers on whether AI spending can generate returns, with focus on Google Cloud growth and capex risk.
Quotes
“Google continues to be well-positioned across AI,”
“That said, execution risk exists, and we are incrementally cautious on Search as we believe competition is increasing with agents and requires another pivot.”