Alphabet ( NASDAQ:GOOG )( NASDAQ:GOOGL ) reported fourth-quarter earnings that exceeded analyst estimates, with full-year revenue exceeding $400 billion for the first time ever. However, the tech stock's guidance for 2026 capital expenditures, ranging from $175 billion to $185 billion - nearly double the $91.4 billion spent in 2025 - raised concerns about profitability amid intense AI infrastructure demands. This outlook triggered a volatile stock reaction, with shares dropping over 6% initially in after-hours trading, recovering to a 2% gain during the earnings call,
As the Wall Street Journal reports, the stock market has been showing marked signs of "fragility," with Nvidia slipping seven percent last week. Despite signs of an end to the ongoing federal shutdown buoying up some excitement, the AI chipmaker continued its plunge this week, sliding another three percent on Tuesday. Meta shares have also fallen almost 17 percent since its quarterly earnings report late last month, despitethe companybeating investors' expectations.