Google leads AI race as earnings surge while Meta struggles amid rising spending

Google is pulling ahead in the artificial intelligence race as strong earnings and investor confidence boost its position against rivals.

Parent company Alphabet saw its shares rise seven percent in late trading, outperforming competitors after releasing its latest financial results. The gains also lifted futures for the tech-heavy Nasdaq 100 Index.

In contrast, Meta Platforms struggled to reassure investors as its shares fell more than six per cent after the company raised its full-year capital spending forecast to as much as $145 billion, citing rising costs.

Analysts noted Meta has yet to show clear returns from its AI investments, with its consumer AI app lagging behind rivals and no major cloud business in place.

Chief executive Mark Zuckerberg defended the strategy but acknowledged uncertainty saying Meta does not have “a very precise plan” for how each AI product will be developed, adding: “I think we have a sense of the shape of where things need to be.”

MEanwhile, Amazon reported strong growth in its cloud division, with revenue rising 28 percent year on year.

Microsoft also projected continued expansion, forecasting a 40 percent increase in Azure cloud sales this quarter.