Google plans to spend $75 billion on AI projects
Google CEO Pichai Announces $75B AI Investment Amid Market Volatility.
Google CEO Sundar Pichai announced that Alphabet plans to invest approximately $75 billion in capital expenditures in 2025 to accelerate its artificial intelligence offerings.
This represents a 43% increase from 2023 and underscores the company’s commitment to innovation despite recent market volatility and competitive pressures, reports Cointelegraph.
Bold Expansion in AI Infrastructure
The planned investment is expected to primarily boost Google’s AI infrastructure, paving the way for advanced machine learning capabilities and improved integration across its core businesses.
While exact figures earmarked for AI remain unspecified, analysts anticipate that a significant portion of the $75 billion will be allocated to building next-generation data centers, upgrading hardware, and developing cutting-edge software platforms. This strategic move comes as Big Tech competitors, such as Meta, have also ramped up their AI spending, with Meta announcing plans to invest $65 billion in similar initiatives.
Market Performance and Investor Sentiment
In its fourth-quarter 2024 earnings report, Alphabet reported an overall revenue of $96.5 billion—a 12% year-over-year increase—and Google Cloud revenue grew 10% to $12 billion, driven by robust performance in AI Infrastructure and Generative AI Solutions.
However, Alphabet’s total revenue fell short of analysts’ expectations of $96.7 billion, contributing to a more than 7% drop in its share price in after-hours trading, according to Yahoo Finance. Despite these short-term challenges, Pichai remains confident in the long-term potential of the company’s technological advancements.
Addressing Competitive Pressures
During a February 4 investor call, Pichai downplayed risks from emerging competitors such as the China-based AI model DeepSeek. He praised Google’s Gemini 2.0 Flash models as among the most efficient in the market, reinforcing Alphabet’s competitive edge. As the company gears up for an aggressive 2025, the focus on bolstering its AI capabilities is expected to drive future growth and innovation.
Recently we wrote, that Google is making strides to transform its Gemini chatbot into a more versatile and up-to-date platform by integrating real-time news content through a collaboration with The Associated Press.
