Alphabet: Launch of TPU as a service, asset-light leverage to leverage huge cloud revenue, maintain positive rating (Barclays)
The Barclays report pointed out that Alphabet is launching a TPU-as-a-service (TPU-aaS) model, building AI infrastructure outside Google Cloud through SPV and partners such as Blackstone and Broadcom, and selling TPU computing power directly to customers such
The Barclays report pointed out that Alphabet is launching a TPU-as-a-service (TPU-aaS) model, building AI infrastructure outside Google Cloud through SPV and partners such as Blackstone and Broadcom, and selling TPU computing power directly to customers such as AI laboratories. This move is expected to significantly increase Google Cloud's revenue and operating profit. External TPU sales are expected to bring in approximately US$250 billion in revenue in 2028 and contribute to a 15% increase in consensus gross profit. One-sentence conclusion: Alphabet's TPU-aaS model is disruptive. It transforms its own technical advantages into an asset-light, high-margin revenue engine by introducing external capital. It is a new and powerful catalyst for Google Cloud's growth story. Good/bad: Good for ecological partners such as Alphabet (GOOGL.US) and Anthropic. The market may have underestimated the huge potential contribution of the TPU-aaS model to Google Cloud's revenue and profits. Catalyst: The announcement of the first large-scale TPU-aaS contract verifies the feasibility of the business model. Specific investment and construction plans from partners such as Blackstone and Broadcom. In Google Cloud’s quarterly financial report, TPU-aaS’s contribution to revenue and profits was reflected for the first time.