Update (5:00pm ET): It took just a few minutes into the call for management to get to the elephant in the room, namely the relentless spending on overpriced commodity chips, and just like last quarter when GOOGL guided to a much higher capex for the current year, it did so again (if to a slightly lesser extent). The stock promptly slumped 3% to new session lows.*ALPHABET SEES FY CAPEX $195B TO $205B, SAW $180B TO $190BAnd then:*GOOGLE STILL SEES FY27 CAPEX INCREASING 'SIGNIFICANTLY'There was more:*GOOGLE TO EXPAND USE OF THIRD PARTY AI CAPACITY IN Q3*ALPHABET: SEES MODEST MARGIN PRESSURE FROM THIRD PARTY CAPACITYIn kneejerk reaction the stock promptly slumped 4% in AH trading to new session lows.* * * Earlier:As we wrote in our GOOGL preview, according to UBS and JPM analysts, the market would be watching two things above all else when Alphabet became the first hyperscaler to report earnings after the close today: capex guidance and monetization language, as "the debate has shifted from "how big is capex" to "who proves monetization and returns." And yet, in light of the massive expectations for capex growth, the company was facing "downside risk" it it disappointed the buyside bars which were $100BN higher ($350-$375BN) than the median sellside estimate of $250BN. So what did GOOGL just report for fiscal second quarter moments ago? Well, Alphabet reported Q2 cloud revenues that surpassed Wall Street’s expectations but slightly missed on sales tied to its search-engine business, threatening to fuel concerns about its heavy spending on artificial intelligence. The Google parent also said cloud sales totaled $24.77 billion for the quarter ended June 30, a jump of 82% over the same period last year. That was better than the $22.46 billion that analysts expected, but well short of some buyside whisper bogeys. Sales from search advertising generated $63.27 billion, just below estimates for $63.28 billion. Here are the details: Revenue ex-TAC $103.62 billion, +27% y/y, beating estimate $101.07 billion Revenue $119.80 billion, +24% y/y, beating estimate $117.02 billion