Alphabet (GOOGL)

Google Cloud + DeepMind. $75B+ capex guidance for 2025. Major DC builds in TX, OH, VA, GA.

Alphabet (GOOGL) is a tracked supply-chain name in the data-center buildout in the hyperscaler sector. Data Center Index tracks Alphabet's capex history, project wins, and supplier exposure across the AI infrastructure buildout, refreshed daily from SEC filings and project announcements.

Alphabet data center thesis

Alphabet capex has tripled from $32.3B in 2023 to $91.5B in 2025, and Q1 2026 backlog hit $467.6B, up 406% YoY, confirming Google Cloud is finally pulling the same compute demand AWS and Azure have monetized for years. With 24 Google-developed sites totaling 12.8GW (incl. the 2.7GW Nebraska Mega-Campus and 1.1GW Goodnight TX), GOOGL is now the second-most-aggressive hyperscale builder after AMZN. Stock +163% YoY reflects the regime change.

Bull case

  • Backlog compounded from $74.1B (2023) to $242.8B (2025), a 3.3x ramp, and Q1 2026 alone added $310B more; that order book funds 2026 guidance of $175-185B in capex with visible revenue conversion through 2027.
  • Google is the only hyperscaler with both first-party silicon (TPU) and a credible nuclear-power roadmap (Kairos SMR deal at Oak Ridge); on the supply-chain side they are the single biggest direct buyer of HVAC, switchgear, and structural steel for the 9.9GW DeepMind training fleet.
  • Operating income jumped from $112.4B (2024) to $129.0B (2025) even as capex surged 74%, a gross-margin profile (60.4% TTM) that swallows the depreciation step-up better than AMZN or MSFT can.

Bear case

  • At $400.80 and 99.5% of 52-week range, GOOGL is priced as if Gemini wins outright; multiple compression of even 15% on a Search disruption headline would erase six months of return.
  • Backlog growth of 406% YoY in one quarter is the kind of print that invites accounting scrutiny; if the market interprets it as channel-stuffing or deferred-revenue gymnastics rather than real capacity contracts, the rerating reverses fast.
  • $185B 2026 capex against a $91.5B 2025 base is a 100% step-up; power-permit timing in TX (1.1GW Goodnight), IN (1GW Fort Wayne), and NE (2.7GW Lincoln) all need to clear simultaneously or capex slips and ROIC compresses.

Thesis last reviewed 2026-05-09.

Alphabet revenue and capex

In fiscal 2025, Alphabet reported revenue of $402.8B, capital spending of $91.4B and operating income of $129.0B.

Fiscal yearRevenueCapexOperating income
2025$402.8B$91.4B$129.0B
2024$350.0B$52.5B$112.4B
2023$307.4B$32.3B$84.3B

From annual reports filed with the SEC; the most recent was filed 2026-02-05.

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