By Laura Bratton

Alphabet (GOOGL, GOOG) stock dipped 1% during premarket hours Thursday as the tech giant's 2026 capital expenditure forecast soared past analyst expectations.

In its fourth quarter earnings report, Google parent company Alphabet forecast 2026 capital expenditures of $180 billion at the midpoint, well above the $119.5 billion projected by analysts tracked by Bloomberg. That would be roughly double the $91 billion Alphabet saw in capex in 2025, which the company said it spent on servers and data center infrastructure to power AI.

Investors have been concerned about whether the billions of dollars in AI investments that Big Tech hyperscalers are making will pay off. Alphabet stock pared losses to trade down more than 2% Wednesday evening.

Alphabet CFO Anat Ashkenazi said on a call with analysts following the company's earnings release that the higher 2026 spending would go toward AI computing infrastructure as the company looks to develop frontier AI models and meet demand for its Cloud and Services segments.

"The investments that we've made in AI — it's already delivering results across the business," said Ashkenazi. The executive pointed to growth in Google Cloud driven by demand for its AI products. The segment saw fourth quarter revenue spike 48% from the previous year to $17.7 billion, more than the $16.2 billion expected by analysts.

Correction: A previous version of this story misstated Alphabet's Q4 capex. The company had $27.9 billion in capital expenditures during the period.

Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.