GOOGL Stock Rises Overnight: Search Giant Launches New AI Cloud Company With Blackstone’s Backing

• Google’s new venture would go head-to-head with neocloud companies like CoreWeave and Nebius.
• GOOGL stock jumped 1% in overnight trading.
• Investors and fans are turning to the Google I/O developer conference, which kicks off Tuesday morning. 

Alphabet shares were up 1% in overnight trading ahead of Tuesday after the tech giant and investment firm Blackstone announced a new joint venture AI cloud company that would offer compute capacity on demand.

The “new U.S.-based company that will offer efficient data center capacity, operations, networking, and Google Cloud’s Tensor Processing Units (TPUs) as a compute-as-a-service offering,” giving “customers another option to access cloud TPUs in addition to using them through Google Cloud,” Blackstone said in a statement.

Blackstone shares were flat in overnight trading. 

AI Surge Powering Cloud Demand

Top tech companies, as well as emerging cloud firms, are racing to bring additional cloud capacity online to meet the burgeoning demand driven a breakneck development and the wider adoption of AI.

The JV with Google marks the company’s boldest attempt yet to monetize its data center chips with external customers. The venture is expected to compete with firms such as CoreWeave and Nebius — neocloud companies that have gained significant traction by offering supplementary, on-demand cloud computing capacity outside that provided by a customer’s primary cloud provider.

Last month, Google introduced a new AI inference processor designed to run models, alongside an upgraded chip tailored for training AI models.

Google’s Technical Chops, Blackstone Funding

Under the terms of the partnership, Blackstone will invest an initial $5 billion in equity capital from funds it manages. 

The new company, which is yet unnamed, would bring the first 500 MW of capacity online in 2027, with plans to scale significantly over time. Google will supply hardware, including TPUs, as well as software and services to run the capacity.

Blackstone will be the majority owner and is expected to support around $25 billion in compute investments into the new company, the Wall Street Journal reported on Tuesday, citing unnamed sources.

Blackstone is an active investor in AI and counts itself as the world’s largest provider of data centers. In 2021, it struck a deal to buy data-center operator QTS Realty Trust, and in 2024, it agreed to buy data-center operator AirTrunk.

Retail View On GOOGL, BX

On Stocktwits, the retail sentiment for GOOGL and BX remained ‘bearish,’ unchanged since last week. 

GOOGL stock has gained 27% year to date and trades near an all-time high.

The cloud JV announcement comes just ahead of the Google I/O conference, which kicks off Tuesday morning in Mountain View, California, where the company is expected to announce a slew of updates spanning Gemini, agentic commerce, and TPUs.

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