Key Takeaways
- Alphabet’s free cash flow was negative $9.1 billion in the third quarter, its second straight quarter in the red, and management still expects capex to increase significantly in 2027.
- Investors who hope Alphabet will start spending with Microsoft’s discipline are likely to be disappointed: Alphabet’s co-founder, its guidance and the demand for Cloud all point to more spending.
- Analysts now expect Alphabet’s free cash flow to fall to negative $41.8 billion in 2027 before it turns slightly positive in 2028.
- The next test is Alphabet’s 2027 capex figure, due on its fourth-quarter call in early February.
Alphabet (GOOG) just burned cash for a second straight quarter, and the question hanging over…