Google has spent $132 billion on capex this year. Most of that money is going to GCP. We have to think about the hundreds of billions being invested to contextualize the profit numbers. $40 bill a year is not enough to justify the capex they’re partaking in, GCP still needs to grow a lot to be successful.
I don't think it's correct to view AI capex as simply booking profit for Google Cloud - theoretically almost every aspect of Google's business should indirectly benefit from those investments. Bigger picture though, the bet behind that staggering capex is future profits, not current profits (see: OpenAI, Anthropic). Even if you think that's a stupid bet, the evidence won't be in 2026 income, it'll be in future income.
The vast majority of that money is going to AI. Some part of it is for internal consumption, some of it is for resale to GCP customers, but it is not some sort of loss making subsidy to prop up GCP.
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