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Roula Khalaf, the editor of FT, selects his favorite story in this week's newsletter.
One of the more exciting things about artificial intelligence bots such as Chatgpt is how reluctant to say “I don't know”. What I can't speak is clearly bothering the world of technology. Recently, Google Parent Alphabet cost $ 20 billion.
This was a total of $ 750 billion planned capital spending this year, and was eliminated from the market capitalization of SeaCh-Engine Giant on Tuesday.
This amount is explained by the need to develop a better AI because the company costs 50 % more than last year. As usual, there were few details about where the expenditure would go or how much profit it would make.
Alphabets are responsible only if the number is surprising. According to the visible Alpha, analysts predicted only $ 600 billion this year. Unlike several rivals, alphabets do not give guidance to keep investors within a reasonable range. But the secret is a choice and is not necessary.
Microsoft is planning to spend $ 80 billion in the fiscal year ending in June, as high -tech companies are betting AI and cloud computing, and Facebook owner Meta has allocated up to $ 65 billion in 2025. 。 。
ALPHABET's financial manager Anat Ashkenazi stated that Google purchases are mainly servers and data centers. However, there was nothing about what kind, which suppliers and where they were.
Other industries solved this long ago. Technology may not like to compare yourself with a simpler sector, but mining companies have learned difficult ways to allow investors to allow past investment forever.
We advertise “hired capital gurdings” as a sign of discipline, such as Riotint and BHP. According to McKinsey's estimation, investors are carefully monitoring that they should be.
Wall Street banks also met investors on the way. Goldman Sachs, City Groups, and their friends have targeted the future for future fair returns.
Goldman missed 14 % of the hurdles last year. City's Chief Jane Fraser had to lower his goal in 2025. But sometimes humble pie service is the cost of spending money on others.
If Alphabet wants to avoid confusion in the future, it can always give some numbers to investors. You can sketch your desired returns regarding capital expenditures and target certain profits of each invested dollar. Even a distant goal is better than anyone. Otherwise, investors will doubt that Silicon Valley is not honest about what Silicon Valley does not know.
john.foley@ft.com
