Half of Google’s and Amazon’s ‘blowout AI profits’ came from a stake in Anthropic—not from their actual business |
Half of Google’s and Amazon’s ‘blowout AI profits’ came from a stake in Anthropic—not from their actual business
Four of the largest U.S. tech companies reported earnings Wednesday afternoon, confirming an AI capital expenditure buildout without modern precedent.
Combined, they spent $130.65 billion on capital expenditures in the first three months of 2026—more than three times the inflation-adjusted cost of the Manhattan Project, in a single quarter. They plan to spend nearly $700 billion this year alone, as much as the U.S. government spends on Medicare.
The headline profits suggest that the bet is paying off; Google parent Alphabet’s profit jumped 81% to $62.6 billion last quarter, while Amazon Web Services delivered its fastest growth in fifteen quarters.
Yet a footnote in each company’s earnings release tells a different story about the origins of these profits. Nearly half of Alphabet’s record profit—about $28.7 billion—did not come from search ads, cloud services or any of its products at all. It came from Alphabet updating the value of the equity it owns in private companies, primarily Anthropic, the AI startup in which Alphabet holds a stake estimated at 14% before the announcement of an additional $40 billion commitment last week.Amazon disclosed a similar........