Google's AI Empire on the Rise! Where Are the Profit Opportunities in the Value Chain?
As Gemini 3 makes its grand debut, $Alphabet-C (GOOG.US)$ TPU steps out from behind the scenes into the spotlight.
Google has built formidable competitive barriers through its full-stack AI layout, spanning from underlying hardware to upper-level applications. This has resulted in a complete ecological closed loop covering "Chips (TPU) - Network (OCS) - Models (Gemini) - Applications".
Against the backdrop of concerns over an "AI bubble" causing divergent trends in the US tech sector, Google's stock price has soared, climbing nearly 13% over the past month.
TPU's Breakthrough Logic: Efficiency First, Restructuring the Compute Economic Model
$NVIDIA (NVDA.US)$ still maintains dominance in single-chip and cabinet peak computing power, with its Blackwell architecture serving as the performance benchmark. However, Google has chosen a differentiated path: instead of pursuing absolute performance leadership, it focuses on building the optimal computing platform around scale, efficiency, and cost.
According to research institute analysis, the key driver for customer choice is TCO (Total Cost of Ownership). Their model shows that the TCO of Google's TPU v7 server can be about 44% lower than NVIDIA's GB200 server. Even when accessed through Google Cloud services, external customers can still enjoy a cost advantage of about 30%. This advantage stems from Google's full-stack integration capabilities, especially its self-developed Optical Circuit Switch (OCS) and 3D Torus interconnection network, which significantly reduce the internal connection costs and complexity of large-scale clusters.
Therefore, the rise of TPU is not a simple "replacement," but rather marks a shift in computing investment logic from pursuing "peak performance" to "economies of scale and operational efficiency." This transformation is turning Google Cloud from an infrastructure service provider into a competitor with strategic AI computing assets.
Industry Chain Gold Mining: US Stock Investment Map Under Full-Stack Innovation
Google has raised its 2025 capital expenditure guidance to $91-93 billion and indicated continued growth in 2026, focusing on expanding TPU clusters and data centers. This investment wave will drive a clear US stock industry chain:
1. Core Layer of Chip and Advanced Manufacturing
Design Foundation: $Broadcom (AVGO.US)$ is the core supplier of the physical foundation for Google's TPU clusters, providing high-speed SerDes, switching ASICs, and optical switching chips.
Manufacturing and Packaging: $Taiwan Semiconductor (TSM.US)$ carries its 3nm/2nm advanced processes; $Amkor Technology (AMKR.US)$ and $ASE Technology (ASX.US)$ are key partners for high-density Chiplet packaging.
Design Tools and IP: $Cadence Design Systems (CDNS.US)$ and $Synopsys (SNPS.US)$ provide EDA tools; $Arm Holdings (ARM.US)$ offers architectural support for its self-developed CPUs.
1. Critical Layer of High-Speed Connectivity and Memory
High-Speed Interconnect: Solving data transmission bottlenecks, including $Astera Labs (ALAB.US)$ (PCIe/CXL), $Credo Technology (CRDO.US)$ (AEC chips), $Marvell Technology (MRVL.US)$ (optical communication DSP), and $Rambus (RMBS.US)$ (memory interface IP).
Storage: $Micron Technology (MU.US)$ positions itself in HBM, server DRAM, and data center SSDs, being the core beneficiary of the storage stack. $Western Digital (WDC.US)$ and $Seagate Technology (STX.US)$ provide massive data storage.
1. Layer of Optical Communication and Physical Infrastructure
Optical Components: $Lumentum (LITE.US)$ and $Coherent (COHR.US)$ are core suppliers of OCS optical switching systems and high-speed optical devices.
Optical Module Manufacturing: $Fabrinet (FN.US)$ is the "king of contract manufacturing" for high-end optical modules.
Connectivity and Cables: $Amphenol (APH.US)$ and $Corning (GLW.US)$ provide critical connectors and optical fibers.
Network Equipment: $Arista Networks (ANET.US)$ is the core switch supplier for Google's data centers.
1. Layer of System Assembly, Cooling, and Power
Assembly and PCB: Including $Celestica (CLS.US)$ , $Jabil (JBL.US)$ , $Flex Ltd (FLEX.US)$ , and $TTM Technologies (TTMI.US)$ .
Power and Cooling: $Vicor (VICR.US)$ solves high-density power supply for AI chips; $Vertiv Holdings (VRT.US)$ , $nVent Electric (NVT.US)$ , and $Parker Hannifin (PH.US)$ provide thermal management and liquid cooling solutions.
Summary
Overall, the rise of Google's TPU is not a zero-sum game of "who replaces whom," but rather triggers a "major expansion" of global AI computing infrastructure. In other words, this is not the final chapter of the GPU era, but a clear signal of the beginning of the next round of computing investment cycle.
Morgan Stanley points out that the role of Google's TPU AI computing clusters is undergoing a strategic transformation: evolving from infrastructure serving internal needs to "AI strategic assets" that can be externally accessed in the context of global computing scarcity. The institution emphasizes that the accelerated growth of Google's cloud business and its expansion into the AI chip market is not only expected to drive Google's own valuation reshape but will also lead its entire AI ecosystem partners into a new phase of valuation with greater potential.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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