Google Reports First Negative Cash Flow Quarter as AI Spending Surges

Google reported $119.8 billion in Q2 2026 revenue, beating expectations, but its stock fell as the company disclosed record AI infrastructure spending that led to its first-ever negative cash flow quarter. Operating cash flow rose 40% year-over-year to $39.1 billion, yet capital expenditures outpaced that growth. Search contributed $63.3 billion, Google Cloud grew 23.8% to $24.8 billion, and YouTube ad revenue rose 12% to $11.1 billion amid longer ad formats.