Google’s parent company Alphabet announced that it plans to increase capital up to 80 billion dollars. This step taken to finance massive artificial intelligence infrastructure investments appears as one of the largest capital increase initiatives ever on a global scale. The capital increase also includes the sale of $10 billion worth of shares to US investment group Berkshire Hathaway.
According to Alphabet, the company will use the money to expand its world-class AI computing infrastructure to meet unprecedented customer demand. The company made the following statements in its statement:
Artificial intelligence is fueling a period of expansion for Alphabet. The company is facing strong demand from businesses and consumers for AI solutions and services, exceeding the company’s current supply. By scaling its investments, the company aims to expand its core infrastructure to support the significant growth opportunity ahead.
In the filing, Alphabet announced that half of the $80 billion will be allocated to expand its artificial intelligence infrastructure and global computing capacity, while $40 billion will be allocated to cover an administrative change in the way it fulfills tax obligations related to the vesting of employee stock awards.
The investment includes $10 billion from Berkshire, an initial capital raise of $30 billion, and a flexible drip-feed mechanism of $40 billion not reserved for artificial intelligence investment, which can be used gradually over time.
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