Google expects to spend $75 billion this year on the AI race

Google mum or dad firm Alphabet expects to take a position “roughly $75 billion” in capital expenditures in 2025, in line with a press release from CEO Sundar Pichai in Alphabet’s Q4 2024 earnings release.

Capital expenditures have change into a hot topic as of late as large tech firms race to construct infrastructure to assist their rising AI ambitions, and in the present day’s announcement from Alphabet is clearly meant to maintain the corporate in that dialog. Alphabet spent $32.3 billion on capital expenditures in 2023, so $75 billion in 2025 can be an enormous bounce. And whereas Google’s press launch in the present day doesn’t particularly say that the upcoming capital expenditures are all for AI, given the sum of money flowing into AI infrastructure throughout the trade, it appears doubtless {that a} good quantity of the expense will go towards benefitting Google’s AI work.

AI continues to profit Google’s enterprise as properly. Total revenues are up 12 % year-over-year to $96.5 billion. Google Cloud revenues are up 10 % to $12.0 billion, which Google says is “led by development in Google Cloud Platform (GCP) throughout core GCP merchandise, AI Infrastructure, and Generative AI Options.”

On in the present day’s investor call, Pichai said that the corporate has “excellent concepts for native advert ideas” in its Gemini AI assistant. He additionally teased that Google plans to place new Search experiences “in entrance of customers via the course of 2025.”

Alphabet-owned Waymo had a pretty good 2024 total, although in the present day’s earnings report exhibits that “Different Bets,” which incorporates Waymo, had decrease income and better losses year-over-year.

In This fall, the Division of Justice additionally proposed that Google potentially divest itself of Chrome as a treatment for Choose Amit Mehta’s August ruling that the corporate is a monopolist within the search and promoting markets. The ultimate consequence of these cures may have a big effect on Google / Alphabet’s future.

Replace, February 4th: Added particulars from Alphabet’s investor name.