Google Taps Oracle to Sell TPUs, Opening $9.4 Billion Chip Business Beyond Its Cloud
Updated
Updated · CNBC · Oct 28
Google Taps Oracle to Sell TPUs, Opening $9.4 Billion Chip Business Beyond Its Cloud
3 articles · Updated · CNBC · Oct 28
Summary
Oracle will offer Google’s TPUs to customers, the first time the chips are available outside Google’s own infrastructure as Alphabet pushes deeper into the AI chip market.
Google is widening distribution to reach more buyers and challenge Nvidia, after opening TPUs to outside data centers in the second quarter and touting lower ownership costs for its latest Ironwood systems.
TD Cowen models $9.4 billion in TPU sales in this year’s second half and $62.5 billion in 2027, though external sales carry about 20% operating margins versus roughly 35% for Google Cloud last quarter.
Google Cloud is expanding from a smaller base—analysts expect about 90% revenue growth after 82% in the second quarter, when cloud revenue hit $25 billion versus $42 billion at AWS and $29 billion at Azure.
Anthropic already agreed to use up to 1 million TPUs in a deal worth tens of billions, and OpenAI is also planning TPU purchases, showing Google is supplying chips even to AI model rivals.