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Alphabet Announces Third Quarter 2026 Results [pdf]

65 points mfiguiere 1 hour ago 47 comments

hungryhobbit 1 hour ago | parent

TLDR; Alphabet hit negative free cash flow for the first time ever since going public.

Translation: even Google ... a company that basically has a license to print money (aka Google Search) ... is losing a ton of money on AI.

olejorgenb 1 hour ago | parent

Negative free cash flow is not the same as losing money

JKCalhoun 1 hour ago | parent

Like others, desperate to make sure they're the next Google.

nbevans 1 hour ago | parent

posting about negative free cash flow seems to be the new tell for those pretending to know what happens next in the AI era. this post included.

cs702 1 hour ago | parent

Impressive growth, and even more, ahem, impressive capital spending :-O

According to page 6, year to date in 2026, operations generated $127B in cash, and capital spending on property and equipment was $132B, so year to date, the business consumed $5B.

According to page 8, in the last quarter, operations generated $42B and capital spending was $51B, so over the past three months, the business consumed $9B.

Those figures don't include any capital spending made through off-balance sheet arrangements. No idea what those might be, or for how much Alphabet could be on the hook.

I'm curious to see if all that money invested in infrastructure will pay off. I hope it pays off, for everyone's sake, but hope is not certainty.

paxy 1 hour ago | parent

It's wild how quickly the tide turned from big tech companies having hundreds of billions in cash reserves and not knowing what to do with it to now taking on hundreds of billions in debt for questionable infrastructure buildouts.

gradus_ad 51 minutes ago | parent

Ironically their massive cash reserves created an environment where the cost of AI infrastructure could be bid up so much to consume those very cash reserves.

mirekrusin 1 hour ago | parent

Why their shares tanked 10% then?

UncleOxidant 1 hour ago | parent

Pretty sure it's this part:

> generating $127B in cash, and capital spending on property and equipment was $132B, so the business consumed $5B.

utopcell 49 minutes ago | parent

not sure why you're getting downvoted, this is pretty much the reason.

mirekrusin 48 minutes ago | parent

well, they don't burn it like anthropic on rent, they spend it on their own TPUs, right?

mono442 39 minutes ago | parent

There's no guarantee it'll generate big enough returns and it's probably at jacked up prices.

treis 1 hour ago | parent

It's a tale of two AIs for Google. Cloud doubled revenue and tripled profit, probably based off serving models. So good for Cloud.

Search increased revenue and profit which is good. Means that LLMs are not yet stealing revenue. But also bad because the massive spend on infrastructure doesn't look like it's going to come back as increased revenue.

mirekrusin 49 minutes ago | parent

Out of all companies, with their own TPUs and native large scale computing... "habitat" they exist in – they probably know how to spend it well.

Anon1096 34 minutes ago | parent

People on the internet really overrate google's TPU advantage. OAI and Anthropic and others have been using TPUs as well for a long time now too. And they've also hired lots and lots of talent from the rest of FAANG, hyperscale compute talent and knowledge is also well distributed through all the top AI companies at this point.

ismailmaj 31 minutes ago | parent

They control the supply chain though, so they can't be price-gouged by Nvidia

hiddencost 1 hour ago | parent

It's about expectations. They missed expectations on earnings, meaning they're less valuable than people thought.

rubiquity 36 minutes ago | parent

First signs that Search revenue might be peaking.

anukin 27 minutes ago | parent

They need to do layoffs and it will pop by 20%

paulpauper 20 minutes ago | parent

because missed estiamtes https://finance.yahoo.com/technology/article/google-stock-pl...

vessenes 50 minutes ago | parent

I mean, it will pay off for society one way or the other — we’ll have the datacenters and (hopefully) the weights at the end of this.

That’s an amazing amount of revenue and spend, though. Wild.

paulpauper 40 minutes ago | parent

The buildout is out of control lol

maerF0x0 37 minutes ago | parent

sell shovels

HDThoreaun 7 minutes ago | parent

Google is selling shovels. They spent $131 billion to produce shovels so far this year

MattCruikshank 1 hour ago | parent

...and the stock falls 8% in after-hours trading.

paulpauper 38 minutes ago | parent

this happens a 3-4 times a year and it bounces back within a few months

gigatexal 1 hour ago | parent

Meh I bought the dip. Google has such giant moats. I’m still hugely long tech.

paxy 1 hour ago | parent

I'm sure Google will end up being one of the winners no matter what but man the market hates the stock. It was trading at 16 p/e before earnings and is now at like 14. Less than half of Microsoft, Apple, Nvidia.

donsupreme 1 hour ago | parent

why do people on HN hate AI so much?

chilipepperhott 59 minutes ago | parent

I've found people on HN to be far more AI-tolerant than any other group of people I've encountered yet.

newsclues 52 minutes ago | parent

Personally because it’s made pc parts unaffordable or unobtainable.

lovich 42 minutes ago | parent

Well it’s currently negatively affecting my life in every aspect other than being an upgrade to searches.

I don’t discount its capabilities since around April of this year, it passed my bar for being able to do amazing things. But it has also made any interaction I’ve had with companies a living nightmare and appears to have permanently deleted my career and knocked me down 1-2 economic classes.

febusravenga 41 minutes ago | parent

Personally, because it forced me to abandon my craft as programmer and become meat proxy ...soon to be replaced.

pixl97 41 minutes ago | parent

Because there are a lot of people on HN and the general population is very split on AI.

malfist 40 minutes ago | parent

You can't think of any reasons not to like AI?

paulpauper 18 minutes ago | parent

being pro-Ai is a minority or outsider position even though AI critics frame themselves as outsiders.

asb-qwer 59 minutes ago | parent

Ad sales fall because the AI mania has made it clear that Big Tech does not care about humans, so humans go elsewhere.

Advertisers on the other hand are alerted to viewbotting with increasingly sophisticated AI "users".

It was clear already two years ago that the model of AI generated "content" that is watched by AI viewbots does not work. Of course Big Tech has to steam forward and find out the hard way.

Congrats, you have ruined the entire SV business model with your fantasies derived from cheap, horribly written SciFi novels.

_aavaa_ 54 minutes ago | parent

As sales dropped probably because people ask their AI for answers and searches instead of Google…

dktp 41 minutes ago | parent

Ad sales grew

aser-asd 34 minutes ago | parent

Much lower than anticipated:

https://finance.yahoo.com/technology/article/google-stock-pl...

paulpauper 19 minutes ago | parent

Ad sales fall because the AI mania has made it clear that Big Tech does not care about humans, so humans go elsewhere.

This isn't true. Meta ad sales and traffic are surging. This is mostly a problem with Google.

HardCodedBias 55 minutes ago | parent

1. Cloud killed it.

2. Youtube meh, like always (weird that it doesn't kill it)

3. Search -- this was the issue. QonQ 0.1% <-- the whole story

Everyone has expected Search to, sooner or later, crack. This looks like it may be it.

If Google had 30B in revenue from coding tools and a few billion from Gemini Enterprise then there would be a story that Google could get through this.

But GDM didn't execute. And that's that.

Who knows the bottom. More than 10-15% seems unlikely. But if search cracks again next quarter then we'll see a real revaluing of the business.

Google did not have the proper focus on AI. They should have owned the space. But there were clearly management issues.

alex1138 51 minutes ago | parent

Youtube has sucked for many years. I just don't know how much Google is responsible for it. Back in 2006, they were dealing with copyright battles (despite the fact they won their lawsuit against Viacom) so Google bought them to help them out with their resources. The site itself has tons of censorship and bad targeting on the recommended videos and I think Neal Mohan has made it even worse the last few years with more and more ads and Shorts and everything

_ink_ 35 minutes ago | parent

> Youtube meh, like always (weird that it doesn't kill it)

It's a huuuge training set, why would they kill that?

HardCodedBias 28 minutes ago | parent

Kill it as in "awesome financial results"

paulpauper 39 minutes ago | parent

Google makes a shitton of money with the same ol' click ads--same as in 2004. But with a bunch of other stuff added, like AI spending.

spwa4 2 minutes ago | parent

... and immediately crashed 10% down.