Alphabet (NASDAQ:GOOGL) shares gained more than 2% in U.S. premarket trading on Thursday after the tech conglomerate reported second-quarter results that exceeded analyst expectations and raised its 2025 capital spending forecast.

The Google parent posted earnings per share of $2.31, topping the consensus estimate of $2.17. Quarterly revenue reached $96.43 billion, also surpassing forecasts of $93.9 billion.

The company now anticipates capital expenditures of around $85 billion for 2025, up from a previous outlook of $75 billion and notably higher than analyst projections of $73.31 billion. The increase, representing a 13.3% rise from the prior year, reflects intensified investments in artificial intelligence and cloud infrastructure.

Alphabet has increasingly integrated AI into its core search business to counter rising competition from emerging players like OpenAI and Perplexity.

AI advancements have also bolstered the firm’s advertising segment, with total ad revenue rising 10.4% year-over-year to $71.3 billion. The search division, in particular, posted a strong 11.7% annual growth.