Alphabet said Monday it plans to raise $80 billion through a stock sale to help finance its growing investments in artificial intelligence infrastructure.
The company said the proceeds will be used for general corporate purposes, including capital spending aimed at expanding AI infrastructure and computing capacity worldwide.
Part of the plan includes the sale of $10 billion in stock to Berkshire Hathaway, the global holding company formerly led by Warren Buffett.
Alphabet said demand for its AI products and services from businesses and consumers has outpaced its current capacity.
“The company is experiencing strong demand for its AI solutions and services from enterprises and consumers, at levels that are exceeding the company’s available supply,” Alphabet said in a statement.
The company said additional investment would allow it to expand the infrastructure needed to support future growth.
“By scaling its investments, the company seeks to expand its foundational infrastructure to support the significant growth opportunity ahead.”
Alphabet also said the stock offering would help finance those investments while maintaining a strong balance sheet.
AI spending plans
Google, like other large technology companies, has outlined major spending plans to support new AI products and services.
Speaking at Google I/O last month, Chief Executive Sundar Pichai said the company expects to spend between $180 billion and $190 billion on capital expenditures before the end of the year.
Tech companies as a group are projected to spend as much as $700 billion on AI-related capital expenditures this year.
TL;DR:
Alphabet plans to raise $80 billion through a stock sale to fund AI infrastructure expansion. The company said demand for its AI services exceeds current capacity. Berkshire Hathaway is expected to buy $10 billion worth of stock.
AI summary:
- Alphabet plans to raise $80 billion through a stock sale.
- Funds will support AI infrastructure and computing capacity.
- Berkshire Hathaway will buy $10 billion in stock.
- Alphabet said demand for AI services exceeds available supply.
- Sundar Pichai previously projected up to $190 billion in capex this year.
