---
title: "Alphabet bought back zero stock for two quarters; $200 billion of capex and Anthropic take the cash"
description: "Alphabet reports Q3 after the close tonight with buybacks at zero for the first time since 2017. The cash that went to shareholders now funds data centers, debt and pre-IPO Anthropic equity, and cloud revenue has to grow fast enough to justify the switch."
publisher: "The Inference"
section: "Data Center"
published: 2026-10-28T13:05:13.226Z
modified: 2026-10-28T13:21:45.684Z
canonical: https://theinference.org/article/alphabet-bought-back-zero-stock-for-two-quarters-200-billion-of-capex-and-anthropic-take-the-cash
language: en
keywords: "Alphabet, Capital Expenditure, Buybacks, Google Cloud, Anthropic, Meta"
---

# Alphabet bought back zero stock for two quarters; $200 billion of capex and Anthropic take the cash

> Alphabet reports Q3 after the close tonight with buybacks at zero for the first time since 2017. The cash that went to shareholders now funds data centers, debt and pre-IPO Anthropic equity, and cloud revenue has to grow fast enough to justify the switch.

## Two quarters of zero on the buyback line

[Alphabet](https://theinference.org/markets/companies/alphabet) reports third-quarter results after the close tonight, and the line that explains the stock sits near the bottom of the cash-flow statement. Share repurchases have read zero for two straight quarters, [the first pause since 2017](https://www.newsbytesapp.com/news/business/alphabet-pauses-buybacks-for-data-centers-1st-time-since-2017/tldr) [1][2]. That ends a streak that returned roughly $300 billion to shareholders over five years, more than any of the other hyperscalers, as the giant cloud-and-compute operators are known; among Alphabet, [Microsoft](https://theinference.org/markets/companies/microsoft) and [Amazon](https://theinference.org/markets/companies/amazon), only Microsoft repurchased stock in the recent period [3].

## Where the money goes instead

The first half of 2026 absorbed $56 billion of acquisitions and nonmarketable securities, primarily [Anthropic](https://theinference.org/markets/companies/anthropic) shares [1][2]. Full-year capital spending is guided to about $200 billion, roughly $120 billion of it still to come, a plan [The Inference covered on October 25](https://theinference.org/article/alphabet-s-195-billion-2026-capex-funds-gemini-and-deepmind-gets-the-compute-first); the paused buyback is the new turn [2].

In the June quarter, [capex of $44.9 billion overtook operating cash flow of $39.1 billion](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001652044) [4], a $5.9 billion shortfall and the first negative free-cash-flow quarter since Alphabet went public in 2004 [5]. The bridge is $77 billion of debt added over nine months, plus $30 billion of share sales and $19 billion of mandatory convertible preferred, preferred shares that must convert into common stock [2].

*Chart: **Debt did most of the work in Alphabet's first-nine-months funding** Bar chart of Alphabet's 2026 financing: $77 billion of debt, $30 billion of share sales and $19 billion of mandatory convertible preferred*

*Capital raised over the first nine months of 2026, in US$ billions, per Barron's from Alphabet's filings. [2]*

*Chart: **Alphabet's capex passed its operating cash flow in Q2 2026** Line chart of Alphabet quarterly capital expenditures and operating cash flow from Q3 2023 to Q2 2026, in billions of dollars, showing capex crossing above operating cash flow in Q2 2026*

*Quarterly figures in US$ billions from Alphabet's SEC filings, retrieved October 28, 2026; the 2004 comparison is from The Motley Fool. [4][5]*

## The return leg runs through Anthropic

The bull case is not hand-waving. Google Cloud [grew 82% to $24.8 billion last quarter](https://www.fool.com/investing/2026/10/11/alphabets-google-cloud-is-surging-at-82-and-the-he/) at a 35.6% operating margin, on [a $514 billion backlog](https://theinference.org/article/goldman-turns-alphabet-s-514-billion-backlog-into-a-300-billion-a-year-bill) that management expects to turn half into revenue within 24 months [5]. Tonight's consensus calls for cloud revenue up about 90% to $29 billion, with segment operating income near $10 billion, up 171% [1][2].

Much of the return now routes through Anthropic, the AI lab whose IPO is set for mid-November. Anthropic [owes Google Cloud $114.5 billion through 2033](https://www.msn.com/en-us/news/other/alphabet-swaps-buybacks-for-data-centers-wall-street-is-getting-nervous/ar-AA2gen9X) under one TPU agreement, the Tensor Processing Unit being Google's own AI chip, and has a second cloud deal worth $125 billion to $150 billion from 2028, on which Google may not be the sole service provider [2].

[Broadcom](https://theinference.org/markets/companies/broadcom), which co-designs the chips, is charging Anthropic $161 billion to rent them [2]. Alphabet stays a greater-than-5% shareholder after the IPO and holds an option for $10 billion more stock at the offering price [2][6].

## Meta sells new stock; Alphabet mostly borrows

[Meta](https://theinference.org/markets/companies/meta) burned $2.12 billion of cash last quarter, its first negative free-cash-flow quarter in over a decade, and this week it [raised its largest-ever equity offerings to a record $97.5 billion](https://money.usnews.com/investing/news/articles/2026-10-26/meta-launches-35-billion-stock-offering-to-fund-ai-expansion), with a separate at-the-market program, which sells shares into the market over time, for up to $60 billion more [7]. Alphabet is selling stock too, but its buildout is funded mainly with debt [2].

Chief financial officer [Anat Ashkenazi](https://theinference.org/markets/people/anat-ashkenazi) has said 2027 spending will "increase significantly" [2]. Three lines decide tonight: whether the repurchase figure stays at zero, whether cloud clears $29 billion, and any word on the $10 billion Anthropic option [6].

## Takeaway

Alphabet has stopped repurchasing stock to fund a $200 billion capex year and Anthropic stakes; tonight's cloud number decides whether the trade holds.

## Sources

1. [NewsBytes, "Alphabet pauses buybacks for data centers 1st time since 2017", 27 October 2026](https://www.newsbytesapp.com/news/business/alphabet-pauses-buybacks-for-data-centers-1st-time-since-2017/tldr)
2. [Barron's (Adam Levine), "Alphabet swaps buybacks for data centers. Wall Street is getting nervous", 28 October 2026](https://www.msn.com/en-us/news/other/alphabet-swaps-buybacks-for-data-centers-wall-street-is-getting-nervous/ar-AA2gen9X)
3. [24/7 Wall St (Danielle Liverance), "Alphabet Just Cut Share Buybacks To $0, While Acquiring A $40 Billion Stake In A Rival AI Company", 22 July 2026](https://247wallst.com/investing/2026/07/22/alphabet-just-cut-share-buybacks-to-0-while-acquiring-a-40-billion-stake-in-a-rival-ai-company/)
4. [Alphabet, quarterly figures from its SEC filings, retrieved 28 October 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001652044)
5. [The Motley Fool (Lyle Daly), "Alphabet's Google Cloud Is Surging at 82%, and the Heavy Spending Is Starting to Make Sense", 11 October 2026](https://www.fool.com/investing/2026/10/11/alphabets-google-cloud-is-surging-at-82-and-the-he/)
6. [NDTV Profit (Nikhil Tiwari), "Anthropic IPO: Alphabet set to become largest shareholder, Amazon among biggest backers", 27 October 2026](https://www.msn.com/en-in/news/other/anthropic-ipo-alphabet-set-to-become-largest-shareholder-amazon-among-biggest-backers/ar-AA2g72x0)
7. [Reuters (Jaspreet Singh) via U.S. News & World Report, "Meta Eyes Record $97.5 Billion Equity Raise to Fund AI Expansion", 26 October 2026](https://money.usnews.com/investing/news/articles/2026-10-26/meta-launches-35-billion-stock-offering-to-fund-ai-expansion)


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Alphabet bought back zero stock for two quarters; $200 billion of capex and Anthropic take the cash — The Inference. Canonical: https://theinference.org/article/alphabet-bought-back-zero-stock-for-two-quarters-200-billion-of-capex-and-anthropic-take-the-cash