Artificial Intelligence isn't just changing the way we live and work, it's igniting an unprecedented boom in AI infrastructure investment all over the world. According to recent projections, AI infrastructure spending is estimated to reach up to $4 trillion by 2030. Fueling this surge, tech giants are setting aside hundreds of billions of dollars to expand their AI computing capacity, build new data centers, and upgrade networks. AI Infrastructure as the Next Big Asset ClassSo what's driving this wave? At i ...

BREAKING: Futures Rise After Oracle Fuels AI Rally Google parent Alphabet (GOOGL) is leveraging Google's artificial intelligence prowess in models, chips, agents and data security to grow its cloud computing business, the chief executive of its cloud business, Thomas Kurian, said at an industry technology conference on Tuesday. Google stock climbed. "We've spent years building advanced AI technology of our own — chips, systems, tools, agents — we made those bets very early," Kurian said at Goldman Sachs' Co ...

RT Martin Baeuml (@mbaeuml)Our TPUs right now https://t.co/Sc30D295P6 ...

RT Josh Woodward (@joshwoodward)Our TPUs right now https://t.co/cMdYcn2hRa ...

Core Viewpoint - Alphabet is undervalued as an AI megacap stock, trading at a forward P/E ratio of less than 19 times analysts' 2026 earnings estimates, despite its strong positions in search, mobile, video, cloud computing, and robotaxi businesses [2][16]. Search and AI - Alphabet's stock is perceived as cheap due to investor concerns about AI disrupting its Google Search business, but search revenue growth accelerated by 12% year over year to $54.2 billion in Q2 [3][17]. - Over 2 billion users engage with AI Overviews in Google Search, and the newly launched AI Mode is gaining popularity, with 82% of users finding it more useful than traditional search [5][6]. Distribution Advantage - Alphabet benefits from not needing to change consumer habits, as billions already use Google daily, enhancing user experience through AI integration [6]. - Google controls two-thirds of the global browser market with Chrome and powers over 70% of smartphones with Android, making it a primary entry point to the internet for billions [7]. Advertising Network - Alphabet has built a powerful advertising network over decades, serving a wide range of clients from global brands to local businesses, creating a significant competitive moat [8]. Cloud Computing - Google Cloud is a major growth driver, with revenue surging 32% in Q2 to $13.6 billion and operating income more than doubling to $2.8 billion [10]. - Adoption of Google's AI models and custom tensor processing units (TPUs) is increasing, providing a cost advantage for Google Cloud [11][12]. - Demand for cloud services is so high that capacity constraints may persist into 2026, prompting Alphabet to invest in new data centers to enhance profitability [13]. Emerging Businesses - Alphabet's Waymo is leading in the autonomous driving sector, currently available in multiple cities and testing in 10 new markets [14]. - Advancements in quantum computing, particularly with the Willow chip, could provide significant growth opportunities in the future [15]. Investment Opportunity - Despite its strong market position and emerging business potential, Alphabet trades at one of the lowest valuations among major tech AI leaders, making it an attractive investment for exposure to AI and emerging technologies [16][17].

Investment Rating - The report assigns an "Overweight" rating to Alphabet Inc. (GOOGL) with an "Attractive" industry view and a price target of $185.00, indicating a potential upside from the current price of $178.53 [6]. Core Insights - OpenAI's decision to use Google Cloud's TPUs for its inference workloads is seen as a significant endorsement of GOOGL's technology infrastructure capabilities, highlighting GOOGL's leading position in the ASIC ecosystem [3][4]. - The partnership between OpenAI and GOOGL could drive further growth for Google Cloud, as rising developer familiarity with TPUs may lead to increased adoption outside of Google [4]. - The report notes that NVIDIA's capacity constraints may have influenced OpenAI's choice to utilize GOOGL's TPUs instead of NVIDIA's offerings [8][9]. Summary by Sections Partnership and Technology - OpenAI is reportedly finalizing a deal to use GOOGL's TPUs to meet its increasing inference demand and manage costs, although it will not have access to GOOGL's most powerful TPUs reserved for its own models [2][3]. - This partnership marks the first significant use of non-NVIDIA chips by OpenAI, emphasizing GOOGL's strong position in the ASIC market [3]. Market Dynamics - The report anticipates that while NVIDIA's GPUs will remain the primary choice for enterprises, the growing familiarity with TPUs could enhance GOOGL's Cloud business [4]. - Current estimates suggest that spending on NVIDIA GPUs will reach approximately $243 billion by 2027, while spending on TPUs is projected to be around $21 billion, indicating a potential market share shift for GOOGL [4]. Competitive Landscape - The report highlights that OpenAI's choice to use GOOGL's TPUs over AWS's Trainium could reflect AWS's capacity constraints, which may negatively impact AWS's growth prospects [9]. - The competitive dynamics in the cloud computing space are shifting, with OpenAI now utilizing services from multiple cloud providers, excluding Amazon [9].

Core Insights - Nvidia is currently leading the AI industry with record financials and high profit margins, but faces significant risks from U.S. tariffs and competition from emerging companies [2][9][10] Group 1: Company Performance and Strategy - Nvidia attracted a record 25,000 attendees at GTC 2025, showcasing its strong market presence [1] - CEO Jensen Huang emphasized the ongoing demand for Nvidia's chips, introducing new powerful chips and personal supercomputers [3][5] - Despite a dip in share price post-keynote, Nvidia aims to reassure investors about the future demand for its products [8] Group 2: Competitive Landscape - Huang addressed concerns about competition from Chinese AI lab DeepSeek and other emerging companies developing low-cost inference hardware [4][6] - Major tech companies like OpenAI and Meta are exploring in-house hardware solutions to reduce reliance on Nvidia chips, which could weaken Nvidia's market dominance [12] Group 3: Tariff and Economic Considerations - Nvidia is currently not facing tariffs on chips sourced from Taiwan, but Huang acknowledged potential long-term economic impacts [9] - The company plans to invest hundreds of billions in U.S. manufacturing to diversify supply chains, which may affect profit margins [10] Group 4: New Business Ventures - Nvidia is expanding into quantum computing, launching a new center in Boston to collaborate with leading hardware and software companies [11][13] - The introduction of products like DGX Spark and DGX Station aims to position Nvidia in the personal AI supercomputer market, although these products are priced at thousands of dollars [14][15]