Grok Hits 17.8% U.S. Share as Capex Surge Threatens Alphabet Buybacks
Elon Musk’s Grok chatbot climbed to 17.8% U.S. market share in January from 14% in December and 1.9% in January 2025, narrowing the gap with Google Gemini’s 29.4% share. Big Tech’s capital expenditure surge threatens to push Alphabet into cash-burn mode, potentially limiting its multibillion-dollar share repurchases.
1. Grok Market Share Gains
Elon Musk’s xAI-owned Grok chatbot climbed to 17.8% of the U.S. chatbot market in January, up from 14% in December and just 1.9% in January 2025, positioning it as the third most-used tool behind ChatGPT’s 52.9% and Google Gemini’s 29.4%. The surge follows cross-promotion on X’s navigation bar, bundled premium access tiers and aggressive infrastructure investment by xAI.
2. Capex Surge and Buyback Risks
Industry-wide capital expenditure has surged as major technology firms invest in data centers and AI infrastructure, pushing some into cash-burn mode. Alphabet has historically returned cash through multibillion-dollar share repurchases, but rising capex could constrain its ability to maintain or increase buyback levels this year.