Alphabet Inc. said demand for artificial intelligence products boosted quarterly sales, and now requires an extreme increase in capital spending — heightening pressure on the company to justify the cost of keeping up in the AI race.

Alphabet Inc has reported strong second-quarter revenue growth but says this year's capital expenditures will be US$10bil greater than an earlier forecast, intensifying pressure on the company to justify investments it's making to keep up in the artificial intelligence (AI) race.