Alphabet's Blockbuster AI Spending Plans, Chips On The Move, & LIVE: Arm CEO Talks Results 2/5/26

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David Faber (0:35)

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Carl Quintanilla (0:45)

Market moving insight and analysis. Join Jim Cramer, David Faber and me, Carl Quintanilla, on the opening bell hour of CNBC Squawk on the Street. Good Thursday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer and David Faber at Post 9 of the New York Stock Exchange. We are coming off the worst two days for tech stocks since October. Futures do suggest we'll get more selling as Google's down 4 percent, downgrade from Microsoft. Labor data today a little sobering. Jobless claims at a two-month high. A roadmap begins with Alphabet and the AI trade. The tech giant reports strong earnings, but this massive jump in CapEx is spooking some investors.

David Faber (1:21)

Shares of Qualcomm and Arm Holdings are both down and early trading. This on potentially what is seen as disappointing forecast from both of those companies. Arm CEO Rene Haas will join us in a first time CNBC later in the hour. We'll talk about the outlook for the company he leads. Take a look at Bitcoin or we will because it is below 70,000. Just heard Andrew talk about that as well. Also silver sliding.

Carl Quintanilla (1:46)

Let's begin with a fresh look into Big Tech's AI spending plan. Shares of Google parent Alphabet under pressure are pronouncing huge CapEx projections for the year ahead. Sundar Pichai explained what's driving those costs on the call.

Sundar Pichai (2:00)

We've been supply constrained even as we've been ramping up our capacity. Obviously, you know, our CapEx spend this year is an eye towards the future. And you have to keep in mind some of the time horizons are increasing in the supply chain, etc. So we are constantly planning for the long term and working towards that. And obviously, how we close the gap this year is a function of what we have done in the prior years, right? And so there is that time delay to keep in mind.

Carl Quintanilla (2:36)

Just to give viewers a sense of where this has gone, Jim, last few years, $35 billion in 03, $53 billion, $90 billion, now $185 billion.

Jim Cramer (2:45)

My chapter trust has a small position. We're looking to buy it. I think you have to buy it.

This was a remarkable quarter. Don't pay any attention to the man behind the curtain of stock price. In fact, this is that they are using this new compute for Google Cloud, okay? And David, do you know who LeBron James is?

David Faber (3:04)

I do, actually, yes.

Jim Cramer (3:04)

And what, you know, who that is when it comes to Google?

David Faber (3:08)

No.

Jim Cramer (3:09)

Okay, so they call Thomas Currian, don't call me Tom. Thomas Currian is the head of Cloud.

David Faber (3:12)

Oh, they call him the LeBron of Cloud.

Jim Cramer (3:13)

He is the LeBron James of Cloud. And this number was so extraordinary. I am not worried.

By the way, Schindler, Philip Schindler did an amazing job with YouTube. I feel that the Gemini uptake is just rather incredible. I just was dazzled by this call. The analysts have to start catching up with how well they're doing. And then one more thing, it's boring as all get out. But, and I know David is deeply focused on it. The one big beautiful bill, the bonus depreciation. Yes. It takes, you can just write this stuff off instantly, because it is in data center, it's not regular buildings. So this was just brilliant. People don't understand that depreciation makes it so that it was worthwhile to buy this stuff now. And they remember they are controlling it. They're not offloading it to say, blew out.

David Faber (4:00)

Right. Your point is right. They are building their own.

Jim Cramer (4:02)

Yeah. It's so impressive, David.