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Alphabet Announces $175‑185 B AI Spending Plan, Shares Slip 2%

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    Image: Le Monde
    Le Monde Source Full size
  • Au siège social de Google, à Mountain View, en Californie, le 4 février 2026.JUSTIN SULLIVAN / AFP
    Image: Le Monde
    Au siège social de Google, à Mountain View, en Californie, le 4 février 2026.JUSTIN SULLIVAN / AFP (JUSTIN SULLIVAN / AFP) Source Full size

Massive AI Investment Triggers Market Pullback On 4 February 2026 Alphabet disclosed a $175‑185 billion AI budget for the year, roughly double its 2025 plan, and its shares fell 2 % in after‑hours trading despite reporting a $132 billion net profit on $403 billion revenue and 750 million Gemini users, with cloud revenue beating forecasts [1]. Investors focused on the scale of spending rather than the earnings beat, prompting a swift sell‑off. The announcement underscored the company’s commitment to AI while highlighting investor sensitivity to cost escalations.

Tech Index Falls as AI Risks Loom The broader technology sector contributed to a 1.5 % decline on the Nasdaq, reflecting Wall Street’s wariness of AI‑related risks for major firms [1]. The index drop followed the same day’s news of Alphabet’s spending plan and Microsoft’s AI concentration concerns. Analysts cited the combined effect of high‑cost AI projects and uncertain monetisation as a catalyst for the sell‑off.

Microsoft Shows Concentration Concerns Microsoft reported Azure revenue growth of only 38 %, down one point quarter‑over‑quarter, and revealed that OpenAI accounts for 45 % of its AI orders, highlighting a concentration risk [1]. Since its November 2025 peak, Microsoft’s market value has fallen 25 %, a decline tied to its heavy reliance on OpenAI and broader AI spending anxieties. The data suggest that investors view Microsoft’s AI strategy as a double‑edged sword, offering growth potential but also heightened exposure.

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Timeline

2022 – ChatGPT launches, sparking the AI boom that later fuels roughly three‑quarters of the S&P 500’s total returns and positions AI stocks as the market’s primary growth engine[1].

Oct 2025 – The S&P 500 sets an all‑time high, a benchmark later referenced as the “late‑October peak” that Nvidia’s 2025 revenue beat fails to surpass[1].

Dec 3, 2025 – The S&P 500 hovers within 1 % of its October record as Marvell beats earnings and announces a $3.25 bn acquisition of Celestial AI, while Capricor Therapeutics soars 307 % on promising Duchenne‑muscle‑dystrophy data[8].

Dec 12, 2025 – AI‑related shares generate 75 % of the S&P 500’s gains since 2022, with Nvidia alone delivering 18 % of this year’s upside; OpenAI reports a $12 bn Q3 loss while targeting an additional 100 GW of U.S. power capacity[1].

Dec 12, 2025 – Nvidia posts record $57 bn revenue but its stock retreats from the October peak; CEO Jensen Huang warns employees of a “no‑win situation” amid market volatility[1].

Dec 12, 2025 – Oracle’s $300 bn partnership with OpenAI spikes its share price 36 % in September, then drags on earnings after a $15 bn spending surge creates a $10 bn negative free‑cash‑flow[1].

Dec 12, 2025 – Michael Burry places $1.1 bn in put options on Nvidia and Palantir, accusing hyperscalers of inflating GPU depreciation and earnings[1].

Dec 12, 2025 – Sundar Pichai and Sam Altman each issue “Code Red” alerts over AI threats, a phrase that spreads into broader political and business discourse[1].

Dec 18, 2025 – U.S. consumer‑price data shows inflation at 2.7 %, below forecasts, prompting the S&P 500 to rise 1.4 % in its strongest day in three weeks[7].

Dec 18, 2025 – Micron Technology’s stock jumps 12.3 % after an earnings beat; CEO Sanjay Mehrotra calls the company an “AI enabler” for its upbeat outlook[7].

Dec 18, 2025 – Trump Media & Technology Group surges 34 % after announcing an all‑stock merger with TAE Technologies, positioning the firm to leverage nuclear‑fusion reactor technology[7].

Dec 19, 2025 – The S&P 500, Dow and Nasdaq all rise, with AI stocks leading; Nvidia climbs 3.4 % and Broadcom 2.4 % as the market stays on track for a weekly gain[6].

Dec 19, 2025 – Oracle jumps 7 % after signing a joint‑venture agreement to operate TikTok in the United States, each of three investors receiving a 15 % stake[6].

Dec 19, 2025 – The Bank of Japan raises its benchmark rate to a 30‑year high, lifting the Nikkei 225 1 % and boosting Asian equity sentiment[6].

Dec 22, 2025 – A holiday‑shortened week begins with broad gains; the S&P 500 reaches 6,878.49, the Dow 48,362.68 and the Nasdaq 23,428.83, while the Russell 2000 leads small‑cap performance with a 1.2 % rise[5].

Dec 22, 2025 – Paramount Skydance sweetens its bid for Warner Bros. Discovery with an irrevocable personal guarantee from Oracle founder Larry Ellison, intensifying the bidding war with Netflix[5].

Dec 22, 2025 – Gold climbs 1.9 % to $4,469.40 and crude oil rises as the Coast Guard pursues a sanctioned tanker, while the 10‑year Treasury yield ticks up to 4.16 %[5].

Jan 2, 2026 – U.S. markets open mixed; the S&P 500 slips 0.1 % after an early gain, while Nvidia posts a 1.6 % rise and Tesla falls 2 % on a second‑year sales decline[4].

Jan 2, 2026 – Alibaba gains 4.3 % and Baidu jumps 9.4 % in Hong Kong after Baidu announces plans to spin off its Kunlunxin AI‑chip unit, targeting a Hong Kong listing in early 2027 pending regulatory approval[4].

Jan 6, 2026 – The S&P 500 (6,944.82) and Dow (49,462.08) set fresh records as tech‑led gains dominate; Amazon, Microsoft and Micron post double‑digit advances while Nvidia dips 0.5 %[3].

Jan 6, 2026 – Small‑cap and storage stocks rally on AI‑driven data‑storage demand ahead of CES, with Sandisk soaring 27.6 % (over 800 % since its February spin‑off) and Western Digital up 16.8 %[3].

Jan 6, 2026 – Oil prices retreat after a prior jump tied to U.S. forces capturing Venezuelan President Nicolás Maduro, pulling U.S. crude to $57.13 and Brent to $60.70[3].

Jan 13, 2026 – Tokyo’s Nikkei 225 hits an intraday record of 53,814.79, led by tech giants Advantest (+8.5 %), Tokyo Electron (+8.3 %) and SoftBank (+4.3 %) following a Wall Street rally[2].

Jan 13, 2026 – Alphabet climbs ~1 % after Apple announces it will use Google’s Gemini model to enhance Siri, pushing Google’s market value above $4 trillion[2].

Jan 13, 2026 – The S&P 500 reaches a new high of 6,977.27, the Dow 49,590.20 and the Nasdaq 23,733.90, extending the record‑setting run of U.S. equities[2].

Feb 4‑5, 2026 – Alphabet pledges a $175‑185 bn AI spend for 2026, roughly double its 2025 plan; despite reporting $132 bn net profit on $403 bn revenue and 750 m Gemini users, its shares fall 2 % in after‑hours trading[9].

Feb 5, 2026 – The Nasdaq drops 1.5 % as investors grow wary of AI‑related risks, while Microsoft’s Azure revenue growth slows to 38 % and OpenAI accounts for 45 % of its AI orders, highlighting concentration concerns[9].

Feb 5, 2026 – Microsoft’s market value declines 25 % from its November 2025 peak, reflecting heightened anxiety over its reliance on AI partnerships[9].

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