For years, US technology giants had a tacit agreement with investors: The companies could spend lavishly on artificial intelligence, and the stock market would reward them long as their revenues were rising. That deal is suddenly breaking down.
Alphabet Inc. shares plunged more than 7% on Thursday, their worst day in over a year after the company raised its capital expenditures in 2026 to as much as $205 billion and reported that free cash flow turned negative in the second quarter for the first time since its 2004 initial public offering.
