New York, June 2, 2026, 08:03 (EDT)
Alphabet Inc. stock dropped in pre-market hours Tuesday after the company said it would raise $80 billion by issuing new equity, with $10 billion of that going to Berkshire Hathaway. The capital will help pay for expanding AI infrastructure. Class A shares were recently indicated at $366.55, off 2.6% from Monday’s close at $376.37.
Alphabet’s decision is drawing attention since the company, which usually relies on cash flow and debt to grow, is now looking for equity cash as it ramps up in AI. U.S. markets were open; Nasdaq’s regular hours run 9:30 a.m. to 4 p.m. Eastern, with pre-market from 4 a.m. to 9:30 a.m.
Alphabet traded lower early even as the overall market held up. At 6:18 a.m. ET, Dow futures slipped 0.4%, S&P 500 futures were off 0.14%, and Nasdaq 100 futures stayed almost flat, Reuters said. S&P 500 and Nasdaq had finished at new highs Monday.
Alphabet is planning $30 billion in underwritten public offerings with both common shares and mandatory convertible preferred stock, a type of security that pays dividends and later turns into ordinary shares. The company also outlined a $40 billion at-the-market program, or ATM, which allows it to sell shares into the market over time. That program is set to start in the third quarter.
Berkshire is set to purchase $5 billion of Alphabet Class A shares at $351.81 and another $5 billion in Class C shares at $348.20, both prices under Monday’s close. The Berkshire order brings a familiar name to the deal, but fresh stock will still hit the market.
Berkshire’s investment is usually seen as a positive sign for the companies it picks, said Steven Check, president and chief investment officer of Check Capital Management, which Reuters says holds Berkshire shares. Glenview Trust Company’s Bill Stone said Berkshire’s latest buy signals it sees Alphabet making “a reasonable return” on its AI spending even as it puts more stock into the market. Reuters
Alphabet is putting the higher capex down to supply, not weak demand. The company said businesses and consumers want more of its AI products than it can provide, and that 2026 capex — for things like data centers, chips, and servers — should come in between $180 billion and $190 billion. 2027 spending will be much higher, Alphabet said.
Alphabet kept growing through the financing shock. First-quarter revenue was up 22% to $109.9 billion, with Google Cloud jumping 63% to $20.0 billion and Search up 19%. CEO Sundar Pichai said in April that AI work was “lighting up every part of the business.” SEC
Big Tech is deep in the AI race. Microsoft, Amazon, Meta and Alphabet were set to spend around $600 billion on AI in 2024, Reuters said in April. Google is also promoting its tensor processing units (TPUs) against Nvidia’s AI chips, which now dominate the market.
But the risk is clear: more shares mean dilution, so each one is a smaller piece of the company. Investors might want to see solid results sooner, showing AI spending can drive lasting sales. Bloomberg Intelligence’s Mandeep Singh thinks capital spending could hit $300 billion next year and said, “There’s only so much capital you can allocate,” The Edge reported, citing Bloomberg. The Edge Malaysia
Traders will get the first read on Tuesday if Berkshire’s support can balance out the overhang. The underwritten common and convertible deals are set to price after the New York session, The Edge said, citing terms from Bloomberg News.
Right now, the stock looks more like it’s testing investor appetite for growth spending than showing a lack of growth. That could be settled soon. Market watchers are set to get U.S. job openings data and fresh Federal Reserve remarks later today, which keeps rate risk hanging over expensive tech names.
