Cloud grew 82%, but $45B of quarterly capex is the real headline

$GOOGL Q2 2026: revenue $119.8B (+24% YoY), and Google Cloud is the standout at $24.8B (+82%), with cloud operating income up to $8.8B from $2.8B a year ago. Consolidated operating margin expanded to 34%. Here's the part getting less attention: capex hit a record $44.9B for the quarter, and free cash flow went to -$5.9B. Search is still fine (+17% to $63.3B) and YouTube ads grew 13%, so this isn't a demand problem — it's a 'how much do we have to spend to keep winning the AI infrastructure race' problem. Cloud's growth rate is genuinely exceptional, but I want to see capex growth decelerate before I get more aggressive here. Watching FCF trend, not just the growth headline.

3 comments

Comments (3)

u/dip_diana13h
Watching capex growth rate next Q too, this is the right question to ask
4
u/compute_cole13h
Negative FCF at this scale is still a choice, not distress. Different from a normal company burning cash 💸
7
u/value_vic13h
Fair concern but 82% cloud growth buys a lot of patience on capex imo
10