RB Markets · The desk · Thursday 29 October 2026

Alphabet lost 12.64% as capital spending outran the cash its business brought in

Alphabet's class A shares closed down 12.64% on Thursday, at $283.82. The Nasdaq Composite fell 1.38%, while the smaller companies of the Russell 2000 rose 1.01%.

The selling followed Alphabet's third-quarter release, dated Wednesday and filed with the SEC. Capital expenditure (spending on long-lived assets such as servers and buildings) reached $51.4 billion, against $24.0 billion a year earlier. Operating cash flow, the cash the business itself brought in, fell to $42.3 billion from $48.4 billion. That left free cash flow at negative $9.1 billion, the cash remaining after the investment. StocksToday reports it was the second negative quarter in a row. Google Cloud revenue rose 103% to $30.7 billion, and the price looked past it.

What the market counted was cash: money out to machines, set against money in from customers. The release holds one figure about people. Alphabet employed 204,757 at the end of September, 14,590 more than a year before, while its capital spending more than doubled. The close priced the cost of the machines. It had no line for what they will do to the work of the people beside them.

The charge landed on the firm that owns and pays for its own capacity, not on the market as a whole. The tape now watches Amazon, which kept its 2026 capital budget at $220 billion, for whether the same charge applies.

Sources

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