Story perspectives

Alphabet Posts $112B Profit, Boosts Capex, Partners with SpaceX

7/23/2026

Summary

Alphabet Beats Forecast

Alphabet Inc. posted Q2 2026 net income of $112.1 billion, driven by a $98.0 billion other-income gain from equity securities.
Revenue rose 24% to $119.8 billion, beating the $117.06 billion estimate, with Google Cloud revenue up 82% to $24.8 billion.
Free cash flow turned negative $5.9 billion, while capital expenditures of $44.9 billion led Alphabet to raise its 2026 capex outlook to $195-$205 billion.
Shares fell up to 7% in early trading before closing down about 1.24%.

Summary

SpaceX Secures AI

SpaceX will purchase large-scale AI computing power from Google’s infrastructure as the cloud partnership expands.
Alphabet invested about $900 million in 2015, while Fidelity added roughly $100 million, together totaling $1 billion for a 5 % SpaceX stake.
The collaboration will integrate Google’s AI services with Starlink’s satellite network to improve edge-computing capability.
Analysts note the equity could lead to joint product development, like co-designing data-center solutions for Starship missions.

History

Historical Context

Amazon Web Services, launched with S3 and EC2 in 2006, proved profitable by 2015 with $2.4 billion quarterly revenue and a 28% operating margin, securing major government contracts such as a $9 billion 2022 DoD deal and a $581 million 2026 Air Force award. Its dominance spurred rivals like Alphabet to pursue AI-driven satellite services, now facing a DOJ antitrust review.

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Alphabet Beats Forecast

Alphabet Inc. posted Q2 2026 net income of $112.1 billion, driven by a $98.0 billion other-income gain from equity securities.
Revenue rose 24% to $119.8 billion, beating the $117.06 billion estimate, with Google Cloud revenue up 82% to $24.8 billion.
Free cash flow turned negative $5.9 billion, while capital expenditures of $44.9 billion led Alphabet to raise its 2026 capex outlook to $195-$205 billion.
Shares fell up to 7% in early trading before closing down about 1.24%.

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