Alphabet’s (GOOGL) in-house tensor processing unit chips could prove to be a $900B weapon in its AI battle with Nvidia (NVDA). This week, Alphabet (GOOGL) shares are trading higher thanks to a rebound in the tech stock market and the success of its Gemini 3 AI model. However, its tensor processing unit chips are also garnering attention, putting GOOGL at the forefront of AI stock talks.

Several experts predict that Alphabet’s TPUs could become a major revenue driver that sends GOOGL stock higher. These application-specific chips have long been the backbone of Google Cloud, and investors are warming to the idea that selling them externally could be a lucrative extension of that strategy. Analysts point to recent momentum triggers, including Alphabet’s commitment to supply tens of billions of dollars of TPUs to Anthropic and reports that Meta may be in talks to spend billions.

Furthermore, Google’s Tensor Processing Units have caught plenty of attention from tech stock investors. Many see the chips as healthy rivals to Nvidia’s GPUs as well as AMD’s. TPU pricing undercuts NVIDIA by roughly 50%, which doesn’t bode well for the latter. Additionally, Meta and xAI are rumored to be evaluating Google Cloud and TPUs. This could end up shifting billions in compute spending away from Nvidia.

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Coming into Thursday, GOOGL shares have surged more than 70% in 2025, on pace for their best year since 2009. As a result, Alphabet is also nearing a $4 trillion market cap, looking to join the ranks of Microsoft, Apple, and Nvidia. A big contributor to this has been AI. Indeed, artificial intelligence has had a positive effect on its business. “We are seeing AI now driving real business results across the company,” said Alphabet CEO Sundar Pichai in the company’s Q3 earnings release.

Major firms and experts on Wall Street are now raising their price forecasts for Alphabet (GOOGL) stock. Last Friday, Justin Post from Bank of America Securities reiterated a Buy rating on the stock with a $335 price target. In addition, on November 19, Mark Mahaney from Evercore ISI also reiterated a Buy rating on the stock with a $325 price target. With stock now at $321, there’s a chance another wave of forecast hikes is coming, some perhaps as high as $350 in Q4 2025.