Alphabet, the parent company of Google, said Monday that it intends to raise $80 billion through stock sales to help pay for the massive expansion of its AI infrastructure.
The company will sell the stock and use the proceeds for what it described as general corporate purposes, including capital expenditures to scale AI infrastructure and global compute, according to a statement.
As part of the plan, Alphabet will sell $10 billion in stock to Berkshire Hathaway, the global holding company formerly led by Warren Buffett.
Strong demand driving investment
Alphabet said the company is seeing strong demand from enterprises and consumers for its AI solutions and services, and that demand is exceeding the company's available supply.
By scaling its investments, the company aims to expand its foundational infrastructure to support what it called a significant growth opportunity ahead.
The company also noted that the stock plan allows it to fund these investments in a balanced way while keeping a healthy balance sheet.
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Industry-wide capex surge
Google is among the tech giants that have announced massive spending plans for compute this year, with the investments going to support a wave of new AI services.
At Google I/O in May, CEO Sundar Pichai said the company expects to spend between $180 billion and $190 billion on capital expenditures before the end of the year.
Across the tech industry, companies are expected to spend as much as $700 billion on AI-related capital expenditures this year.
The announcement comes as demand for AI computing power continues to outpace supply, pushing companies to build new data centers and acquire advanced chips. Alphabet's move to raise capital through stock sales rather than debt allows it to avoid additional borrowing costs while still funding its ambitious expansion plans.
Berkshire Hathaway's participation in the offering underscores the confidence that major institutional investors have in Alphabet's AI strategy. The conglomerate, now led by a successor team after Buffett's retirement, has been increasing its exposure to technology companies with strong cash flows and long-term growth prospects.
Alphabet's infrastructure buildout will support a range of AI products, including its Gemini model, Google Cloud AI services, and consumer applications that rely on large-scale machine learning. The company competes with Microsoft, Amazon, and Meta in the race to dominate AI computing.
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