Goldman Sachs International co-chief executive Anthony Gutman said Wall Street has entered "unprecedented territory" with Alphabet's $80 billion stock sale.
"We all enter it with a degree of humility and caution, and the right balance of focus," Guthman told CNBC. "The Alphabet issuance yesterday augurs well for the pipeline. That was just a record level of issuance on any level," he added.
Guthman went on to claim there is a "lot of demand out there" for large equity issuance and said he believes it to be "very manageable" considering all market capitalization.
The plan in question seeks to help finance one of the most ambitious artificial intelligence expansion plans ever undertaken by a technology company.
Alphabet is racing to build the computing infrastructure needed to meet soaring demand for AI products across its Google Cloud business, enterprise services, and consumer applications. The company said the capital raise will include a $10 billion investment from Berkshire Hathaway.
According to Reuters, Alphabet plans to raise $30 billion through public equity offerings, while another $40 billion will be raised through an at-the-market stock sale program expected to launch later this year. The remaining $10 billion will come from Berkshire Hathaway through a private placement of Alphabet shares.
Alphabet already increased its projected capital expenditures for 2026 to between $180 billion and $190 billion, up from earlier forecasts. Executives have indicated spending will likely continue rising in 2027.
"The company is experiencing strong demand for its AI solutions and services from enterprises and consumers, at levels that are exceeding the company's available supply," Alphabet said when announcing the offering. The company has repeatedly warned investors that it faces capacity constraints as businesses increasingly adopt AI tools powered by Google's Gemini models and cloud computing platform.
Alphabet executives have argued that investing aggressively now is necessary to avoid falling behind competitors such as Microsoft, Amazon, and Meta in what has become a global competition for AI dominance. Fortune Magazine estimated that the largest technology companies could collectively spend more than $700 billion this year on AI-related infrastructure.
In this context, Goldman Sachs CEO David Solomon also weighed in on the development, saying financial markets have moved into a period of investor "greed."
"There's plenty of liquidity in the system if the world continues to remain as optimistic," Solomon said. "We are definitely in a moment where there's more greed than there is fear."
He went on to downplay concerns that the market may not be able to handle the coming wave. He pointed to Alphabet's recent stock performance after the company announced plans for an $80 billion equity raise as an early sign that investors remain receptive to large AI-related offerings.
"The stock is trading very well," Solomon said. "This is the first actual concrete data point for bringing something of this scale, and it's encouraging."
