Google will need to double its serving capacity every six months in order to keep up with AI demand, a company executive told employees in an all-hands meeting earlier this month, CNBC reports.
"The competition in AI infrastructure is the most critical and also the most expensive part of the AI race," Amin Vahdat, vice president in charge of the AI and Infrastructure team at Google, said at the meeting.
The presentation took place just weeks after Google released its Q3 earnings report, announcing its first-ever billion-dollar quarter and raising capital expenditures for the year from $91 billion to $93 billion.
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Low Cost, High Results
Despite the budget change, Vahdat told employees in the meeting that he doesn't expect spending to balloon in 2026.
"[Our] job is of course to build this infrastructure, but it's not to outspend the competition, necessarily," he said.
"We're going to spend a lot," he added, before underlining the team's real goal, to build infrastructure that is "more reliable, more performant and more scalable than what's available anywhere else."
Google's AI Infrastructure team needs to find a way to "be able to deliver 1,000 times more capability, compute, storage networking for essentially the same cost and increasingly, the same power, the same energy level," Vahdat said, according to CNBC. "It won't be easy, but through collaboration and co-design, we're going to get there."
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An ‘Intense' Year
Alphabet (NASDAQ:GOOG, GOOGL)) CEO Sundar Pichai was also at the meeting and told employees that 2026 was going to be an "intense" year in terms of AI competition and meeting cloud and compute demand.
"There will be no doubt ups and downs," Pichai told employees about the coming year, according to CNBC.
"It's a very competitive moment, so you can't rest on your laurels," he continued. "We have a lot of hard work ahead, but again, I think we are well-positioned through this moment."
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Addressing The AI Bubble
During the meeting, Pichai also addressed employee questions about a potential AI bubble, CNBC reports.
The CEO acknowledged the possibility that the AI market may not mature as predicted, but reiterated that his biggest concern was underinvesting in the technology, not overinvesting.
"I think it's always difficult during these moments because the risk of underinvesting is pretty high," Pichai said. "I actually think for how extraordinary the cloud numbers were, those numbers would have been much better if we had more compute."
"We are better positioned to withstand, you know, misses, than other companies," he continued.
Alphabet CFO Anat Ashkenazi was also present at the all-hands meeting and reiterated Pichai's position.
"The opportunity in front of us is significant, and we can't miss that momentum," she said.
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