Alphabet raises capital for AI expansion

Alphabet, the parent company of Google, raised 49.6 billion dollars in shares and convertible preferred shares in June 2026, aiming to expand its AI infrastructure and global computing capabilities. This follows a decision to halt share repurchases, which had previously totaled 11.5 billion dollars in the same period in 2025.

Alphabet faces cash flow challenges

The third-quarter financial statements, released on October 28, showed a negative operating cash flow of 9.1 billion dollars, as investments consumed more cash than was generated. While the twelve-month rolling cash flow remained positive at 19.7 billion dollars, Alphabet is increasing its long-term debt from 46.5 billion at the end of 2025 to 125.1 billion by September 2026.

Microsoft maintains positive cash flow

Microsoft reported a positive operating cash flow of 58 billion dollars in its first quarter of fiscal 2027, ending September 30. Equipment purchases totaled 39.4 billion dollars, leaving 18.6 billion dollars in available cash flow. Its chief financial officer, Amy Hood, noted that the company is using lease financing as a key part of its investment strategy.

Microsoft expands lease financing use

Microsoft’s 45.2 billion dollars in investments included 7.4 billion dollars in lease financing, with plans to increase this approach for future data center leases. The company has not entered the bond market yet but may seek additional financing sources when needed. It also plans to repay 4.85 billion dollars in long-term debt.

Amazon faces cash flow shortfall

Amazon reported an operating cash flow of 42.4 billion dollars for the quarter but spent 77.3 billion dollars on equipment, resulting in a shortfall of about 33.5 billion dollars. The company borrowed 48.1 billion dollars in long-term debt, bringing its total to 173.1 billion dollars, up from 65.6 billion at the end of 2025.

Meta’s cash flow turns negative

Meta reported a negative available cash flow of 2.1 billion dollars for the quarter, a stark contrast to the 10.6 billion dollars in positive cash flow from the same period a year earlier. The company has not borrowed money recently but has increased its long-term debt by 22 billion dollars since December and is issuing new shares to support future fundraising.

Cloud providers face supply constraints

Microsoft and Alphabet are both using third-party computing resources due to supply constraints, which have delayed some investments and increased costs. Microsoft’s chief financial officer noted that customer demand for cloud computing continues to outpace available supply, and the company has seen higher per-token revenue during the quarter.

Future outlook remains optimistic

Alphabet’s chief financial officer, Anat Ashkenazi, stated that the company still expects significant investment growth in 2027 and will provide more details in the fourth-quarter results. Microsoft has adjusted its annual investment forecast downward to about 170 billion dollars, while Meta’s new class C shares will begin distribution in early 2027.