Google's Q2 revenue hit $120 billion, but record $45 billion capex and negative free cash flow, combined with political criticism over overseas AI investments, weigh on the tech giant's outlook.
Google's Q2 FY2026 results show strong revenue and cloud growth, but massive capex and negative free cash flow raise concerns, while Trump's criticism of overseas investment adds political risk.
Google reported a 24% revenue surge to $120 billion in Q2 FY2026, fueled by an 82% jump in Cloud revenue. However, the company faces scrutiny over its massive $45 billion capital expenditure, which pushed free cash flow into negative territory at $5.86 billion. Political pressure is also mounting as President Trump criticized the firm's decision to invest in European data centers rather than domestic projects.
Google is aggressively investing in the physical infrastructure required for AI, with management describing the company as supply-constrained and noting that demand for AI services continues to outpace their current investment capacity.