Alphabet Juggles EU Scrutiny, Worker Unrest And Century Bond AI Bet

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• European regulators have opened a fresh antitrust probe into Google’s search advertising pricing practices, focusing on how ad auctions are run and priced.

• Alphabet is facing internal unrest as employees protest AI partnerships and raise concerns about contracts with government and immigration enforcement agencies.

• The company has issued a rare 100 year bond and is committing large capital to AI infrastructure, drawing attention to the long term risk and reward profile of these investments.

Alphabet, NasdaqGS:GOOGL, is in the spotlight as regulators, employees and credit markets all focus on very different parts of the business at the same time. The stock trades at about $309.0, with a return of 67.5% over the past year and 230.0% over three years, which puts recent moves against a backdrop of strong multi year performance. That context matters as investors weigh how much these new pressures could influence sentiment and valuation.

For you as a shareholder or potential investor, the key question is how Alphabet balances regulatory compliance, workforce concerns and heavy AI spending. The rare 100 year bond and record capital expenditures indicate a very long term commitment to AI, while the EU probe and employee pushback highlight legal and reputational risks that could shape how the company executes on those plans.

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Alphabet’s latest bond deals show how aggressively it is using long dated debt to fund its AI build out rather than relying only on its cash pile. The company has just sold a mix of dollar, sterling and Swiss franc senior unsecured notes, including a rare 100 year £1b bond paying a 6.125% coupon, alongside shorter maturities in 2026, 2029, 2031, 2033, 2046 and 2056 with coupons between 3.70% and 5.75%. With more than $20b raised across currencies and tenors, Alphabet is materially extending the duration of its liabilities while locking in fixed rates. For you, the key questions are how this extra interest burden and very long commitment interact with heavy 2026 capital expenditure guidance of $175b to $185b and ongoing shareholder returns through buybacks and dividends. The strong demand reported for the century bond signals credit markets are comfortable with Alphabet’s balance sheet and cash generation today, but it also increases the importance of disciplined AI infrastructure spending and clear monetisation, especially while Google faces EU antitrust scrutiny on search advertising pricing and internal pushback over certain AI and government contracts.

• The large, multi currency bond issuance directly supports the narrative’s AI infrastructure catalyst, giving Alphabet funding capacity to scale data centers, custom chips and cloud services globally.

• The step up in long term debt and interest costs could pressure margins if revenue growth or AI monetisation do not match the higher capital intensity highlighted as a risk in the narrative.

• The century bond and European offerings extend Alphabet’s funding horizon far beyond what the narrative discusses, so the potential long run impact of this leverage on flexibility and capital allocation is not fully captured.

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• ⚠️ Century long and other long dated bonds increase Alphabet’s fixed obligations, so if AI driven projects underperform expectations, debt servicing could weigh more heavily on future cash flows.

• ⚠️ The fresh EU antitrust probe into search ad pricing, together with employee protests about AI and government work, could affect the regulatory and reputational backdrop for the ad and AI businesses that underpin debt repayment.

• 🎁 Locking in fixed coupons across maturities up to 2126 gives Alphabet predictable funding costs and preserves flexibility to keep investing in AI infrastructure even if credit markets tighten later.

• 🎁 Strong investor appetite for the bonds suggests lenders view Alphabet’s earnings base and balance sheet as resilient, which may support future access to capital compared with peers like Microsoft and Amazon that are also ramping AI spending.

From here, you may want to track how Alphabet’s net debt and interest expense trend relative to operating cash flow as the AI capex ramp plays through, and whether the mix of short and ultra long bonds keeps leverage at a level you are comfortable with. Watch for updates on AI driven revenue from Google Search, YouTube and Google Cloud, since these engines are expected to carry the return on this new debt. Regulatory outcomes from the EU probe into search ad auctions, and any changes to Alphabet’s AI partnerships or government contracts in response to worker pressure, will also shape how sustainable its higher capital intensity looks over time.

To ensure you’re always in the loop on how the latest news impacts the investment narrative for Alphabet, head to the community page for Alphabet to never miss an update on the top community narratives.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include GOOGL.

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