Google’s AI spending drags free cash flow into the red as analysts predict 26% upside
Google reported a strong quarter with revenue of $119.80 billion, up 24.2%, and Google Cloud revenue surging 82% to $24.77 billion. Despite this growth, free cash flow turned negative at -$5.86 billion, driven by a 100% increase in capital expenditures to $44.92 billion. Long-term debt rose from $46.5 billion to $98.2 billion, and the company suspended its share buyback in Q2 2026. Net income of…
Key points
- Google’s Q3 revenue hit **$119.80 billion**, up **24.2%**, but free cash flow turned negative at **-$5.86 billion** due to **$44.92 billion** in capex
- Analysts predict **26% upside** to **$438.32**, though the consensus target is **$420.36**, citing cloud backlog and Gemini 4 as key drivers
- Google’s debt rose to **$98.2 billion**, and net income included a **$99.03 billion** one-time gain, raising concerns about sustainability
Wall Street analysts predict a 26% upside to $438.32, though the consensus target is $420.36 (20.8%). The stock currently trades at $347.86, down 13.9% from its 52-week high of $403.96. To reach $500 by 2029, Google would need a 43.7% gain, requiring strong execution on cloud backlog conversion, Gemini 4’s performance, and a return to positive free cash flow. The article highlights Google’s AI investments—including Gemini 4 training and Google Workspace AI agents—as critical but warns that sustained capex without revenue growth could derail progress.
Model page: Gemini 4 →
Prediction: AI Could Transform This Magnificent 7 Stock Over the Next 3 Years
247wallst.com · 14 October 2026
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