Alphabet is venturing beyond internal use, making its advanced AI chips available to external tech companies, even sending them into space. This strategic shift could transform Google into a leading AI chipmaker, creating significant growth opportunities for key semiconductor partners. We explore three stocks — Broadcom, Marvell Technology, and Taiwan Semiconductor Manufacturing — that are uniquely positioned to benefit from Google’s burgeoning AI hardware ambitions and capitalize on the expanding AI ecosystem.
Alphabet (GOOG, GOOGL) is making a significant play in the artificial intelligence sector, moving beyond merely developing AI chips for its own cloud platform and Gemini. The tech behemoth is now offering its advanced Tensor Processing Units (TPUs) for sale to other companies, a bold move that even saw some chips launched into space on a test satellite in collaboration with Space Exploration Technologies.
Known primarily as an online search and advertising powerhouse, and more recently as a top cloud infrastructure provider, Google's parent company is rapidly positioning itself to become a dominant AI chipmaker. This strategic shift creates immense opportunities for several key players in the semiconductor industry. Here are three stocks that stand to benefit significantly from Alphabet’s expanding AI hardware ambitions.
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1. Broadcom
Broadcom (AVGO) is Google's primary development partner for its Tensor Processing Units (TPUs). The two companies have solidified their collaboration with a long-term agreement, ensuring their continued work together on current and future generations of Google’s TPUs.
Broadcom’s expertise in the chipmaking space is well-established, with existing partnerships with several major tech companies. The company recently announced that AI lab Anthropic is projected to become its largest XPU customer by 2027, an XPU being a broad term for specialized processors. While concerns about circular financing exist regarding Broadcom’s multi-gigawatt chip deal with Anthropic (where Broadcom is lending Anthropic $42 billion for purchases), this risk does not extend to its partnership with Alphabet and other hyperscalers.
Broadcom’s financial performance consistently reflects its strong position in custom AI chip development. Its fiscal 2026 second-quarter results showed an impressive 48% year-over-year revenue growth, with the red-hot AI semiconductor segment surging by 143% over the same period. Analysts anticipate AI semiconductor sales to triple in the upcoming quarter, potentially accounting for nearly half of Broadcom's fiscal 2026 third-quarter revenue. As Google ramps up its TPU production, Broadcom is poised for accelerated growth in this critical segment of its business.
2. Marvell Technology
In a powerful endorsement earlier this year, Nvidia CEO Jensen Huang boldly predicted that Marvell Technology (MRVL) could become the "next trillion-dollar company." This statement, coupled with news of Marvell Technology's partnership with Google to develop custom chips, fueled a significant stock rally, with shares more than tripling year-to-date.
The burgeoning AI market is expanding so rapidly that Alphabet is engaging both Broadcom and Marvell Technology for chip design work, illustrating a scenario where a rising tide lifts all chipmaking boats. For Marvell Technology, this collaboration with Google is projected to generate up to $120 billion in revenue over the next six years alone.
Furthermore, the deal includes an option for Alphabet to acquire a $12.2 billion stake in Marvell Technology at $206.58 per share—a substantial discount to current trading prices. This potential investment would not only provide strong financial incentives for Alphabet to bolster Marvell Technology but also serve as a major validation of its technological prowess. Even prior to the Google deal, Marvell Technology was experiencing rapid growth. In its fiscal 2027 second quarter, revenue climbed 37% year-over-year to $2.74 billion. The company anticipates reaching $20 billion in fiscal 2028 revenue, with the Google partnership expected to significantly contribute starting in Marvell's fiscal 2029.
3. Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing (TSM) is the undisputed leader in chip foundry services, manufacturing advanced processors for virtually all major AI chip designers, including industry giants like Nvidia and Alphabet. Despite its immense capacity, demand for TSM’s services continues to outpace its manufacturing capabilities, providing the company with significant leverage to raise prices and, in turn, boost its profitability.
From an investment perspective, TSM stock presents an attractive valuation, boasting a price/earnings-to-growth (PEG) ratio of approximately 0.6. A PEG ratio below 1 generally suggests that a stock is undervalued relative to its expected growth, making TSM a compelling option for investors. If Google seriously intends to scale its AI chipmaking operations, it will inevitably increase its orders from Taiwan Semiconductor Manufacturing.
TSM employs a sophisticated chip-on-wafer-on-substrate model, which is a critical final step in assembling a collection of components into a high-performance AI processor ready for deployment in data centers. The company's robust financial performance underscores its market dominance, with revenue increasing by 36% year-over-year in the second quarter. Net income surged even faster, leading to an impressive 55.6% net profit margin. Taiwan Semiconductor Manufacturing CFO Wendell Huang has conveyed to investors that the company expects "continued strong demand" for its cutting-edge process technologies, ensuring a bright outlook.
