Alphabet on Tuesday reported its best-ever quarter of growth for its cloud computing division, but shares were down nearly 5% in extended trading after a $15 billion increase in capital spending plans for 2026. The search giant now expects to spend between $195 billion and $205 billion in capital expenditures, up from the $180 billion to $190 billion planned for this year, finance chief Anat Ashkenazi said on a conference call. Revenue at Google Cloud rose 82% to $24.8 billion during the quarter ended June, beating analyst expectations of a 64% increase. Total revenue was $119.8 billion, beating the consensus estimate of $116.9 billion, but adjusted profit per share of $2.85 fell short of projections of $2.89. The company reported negative free cash flow for the first time in its history, burning $5.9 billion this quarter. Concerns about continued delays to its flagship AI model were aggravated by the capex update; Alphabet delayed the June launch of its next flagship model, Gemini 3.5 Pro. CEO Sundar Pichai acknowledged areas needing improvement, citing coding and agentic coding as an example, while noting Google continued to test Gemini 3.5 Pro and had also started training.