Morgan Stanley Sees Google TPU Revenue Reaching $108 Billion by 2028
Google’s Tensor Processing Units were developed to power its own search, cloud and generative AI workloads, but are increasingly being offered to outside customers through Google Cloud. As companies seek alternatives to Nvidia’s GPUs for training and inference, the economics, availability and performance of TPUs have become central to Google’s effort to monetize AI infrastructure and compete more directly with the world’s largest semiconductor suppliers.
Morgan Stanley estimates Google’s TPU business could generate $108 billion in annual revenue by 2028, a scale that would place it among the world’s leading semiconductor companies. Google is also accelerating its chip-release cadence and tailoring processors separately for large-scale model training and low-latency inference. The moves suggest its in-house computing platform is evolving into a standalone commercial chip business serving external customers.
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The history behind this eventGoogle Pitches TPUs in Challenge to Nvidia’s AI Chip Dominance
As generative AI booms, Nvidia has used its GPUs to establish a near-monopoly over the global computing-power market. Seeking to break that grip, Google is aggressively pitching its tensor processing units, or TPUs, to emerging cloud providers such as Nscale, opening a new front in the competition. The push directly challenges Nvidia’s dominance and could reshape the market and control of global AI infrastructure.
In the latest development, Google and Blackstone have teamed up to form a new company, with Blackstone providing an initial $5 billion and total investment expected to reach $25 billion. The venture plans to begin offering TPU cloud-computing capacity for rent in 2027. Nvidia CEO Jensen Huang has responded swiftly with financial incentives for emerging cloud providers as he seeks to shore up their support. The chip battle is expanding beyond technology into an infrastructure contest worth tens of billions of dollars.
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