Alphabet Inc. has become an artificial-intelligence stock, for better or for worse. Though advertising still makes up the lion’s share of the company’s revenue, investors have been focusing more on the part of Alphabet’s business that seems the best proxy for AI momentum.

Cloud revenue in the quarter of $12 billion—a 30% increase from last year—just misses analysts’ estimates of $12.2 billion.

In a conference call with analysts, Pichai caused a bit of a stir when he said that the company plans to increase its capital expenditure to $75 billion in fiscal 2025 as part of an effort to build out its AI infrastructure. That’s much more than the $58.84 billion that analysts were expecting the company to spend in the coming year.

Global stocks fell on Wednesday, after disappointing earnings from Alphabet knocked Wall Street futures, while the dollar took a dive against the yen, which rallied sharply after Japanese wage data upped the chances of another rate hike.

Shares of Google parent company Alphabet (GOOGL) are down 7% after the technology company reported fourth-quarter 2024 financial results that

Alphabet reports fourth-quarter earnings after Tuesday's closing bell. Investors will be focused on cloud momentum and AI traction, with shares of the Google and YouTube parent company holding fast near the record levels achieved last week.

Key Takeaways Alphabet shares fell sharply Wednesday as investors responded to the Google parent's weaker-than-expected revenue numbers and big AI spending plans. The stock broke out from an ascending channel late last month and picked up momentum ahead of the earnings report before today's abrupt reversal.