Google to sell TPU chips as Gemini shows returns

Why give all your cash to Nvidia? Why not make your own chips? Then why not sell them?

Google said that it plans to sell its custom Tensor Processing Units (TPUs) to select customers who will install the chips in their own data centers.

The move is a change from Google’s prior strategy, which saw it rent out TPU capacity to customers from its own data centers — and is yet another strike at AI chip king Nvidia.

The announcement, during the company’s Q1 earnings call, comes a week after Alphabet announced two new TPUs: its TPU 8t for AI training and TPU 8i for inferencing.

Alphabet didn’t disclose potential customers, but it signed a multiple-gigawatt agreement for next-generation TPUs with Anthropic earlier this month, with chips expected to begin coming online in 2027.

And according to The Information, Alphabet has also entered into a multibillion-dollar chip deal with Meta (META).

Source: Yahoo Finance

NB: Alphabet Q1 sales grew 22% to $110 billion, with Cloud up 63% to $20 billion. Operating margins grew by 220 basis points, with services and cloud operating margins both increasing y/y.

The search business continues to benefit from AI. AI overviews and AI mode are sustaining as search sales grew 19%.

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