2025-11-26XQuote

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This is fun to consider. Remember that selling semiconductors involves lots of other support and processes. You don’t just show up in a new business. #itainteasy

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$GOOGL Reports indicate GOOGL could start selling TPUs into external data centers. In a world where NVDA is selling ~8mn annual chips, could TPUs carve out 500k-1mn sales per year? Maybe. Every 500k would add ~10% to '27 GOOGL Cloud rev, 3% to '27 EPS and drive multiple. $META What Does This Mean for META? Potential Way for More Cost Efficient Compute: We have seen META has looked to manage its capex/opex growth as it invests to build a state of the art LLM and improve its core offerings. We view TPUs strong performance per dollar as a key catalyst in META's potential decision to run workloads on these chips. The decision to run workloads through TPUs may help serve as a potential capex offset in '27 given the strong cost performance ratio of these chips. - Morgan Stanley
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