Key Takeaways
- GOOGL shares climbed 2.1% on April 22 following the introduction of the TPU 8i AI inference chip at Google Cloud Next.
- The new TPU 8i chip delivers enhanced speed and energy efficiency for running large-scale AI models.
- Jim Cramer projects a $400 price target for Alphabet, representing approximately 19% upside from the ~$336 level.
- Analyst consensus places the 12-month price target at $387.68, with a Strong Buy rating across Wall Street.
- Year-to-date, GOOGL has advanced 8.4%, outperforming competitors including Baidu and DoorDash.
Shares of Alphabet received a boost on April 22 when the tech giant introduced its newest proprietary chip during the Google Cloud Next conference.
Dubbed the TPU 8i, this chip focuses on AI inference—the real-time execution of trained machine learning models. According to Google, the chip offers superior throughput and reduced latency compared to earlier versions, alongside improved energy efficiency.
The TPU 8i integrates seamlessly into Google Cloud’s infrastructure, enabling business clients to deploy generative AI applications at scale using proprietary hardware rather than external suppliers. For shareholders, this vertical integration strategy could enhance profit margins down the line.
Throughout the conference, Alphabet’s team conducted live demonstrations highlighting accelerated query processing and enhanced AI assistant capabilities. The underlying message: this technology is ready for immediate commercial deployment.
GOOGL ended the trading session 2.1% higher following the reveal.
How the New Chip Impacts Google’s Product Ecosystem
Company leadership indicated the TPU 8i will drive AI functionality throughout Google Search, advertising platforms, and Workspace applications. This represents significant operational scale.
The introduction aligns with Alphabet’s long-term approach to developing proprietary AI infrastructure instead of relying on external vendors. This strategic direction has been underway for several years, and market participants are increasingly recognizing its value.
Since the start of the year, GOOGL has risen 8.4%, surpassing the 4.4% gain posted by the internet services sector overall. Meanwhile, Baidu has declined 5.7% during the same period, while DoorDash has fallen nearly 20%.
Cramer’s $400 Price Objective and Analyst Sentiment
During his lightning round segment on April 22, Jim Cramer delivered a straightforward prediction: “Alphabet is going to $400.”
This price objective suggests approximately 19% appreciation from the $336.24 trading level at the time of analysis. Cramer has publicly stated his regret over previously exiting his GOOGL position, and now maintains that the company’s progress with its Gemini AI platform warrants renewed optimism.
He further contends that Google has successfully integrated AI capabilities into its search engine in a manner that strengthens rather than disrupts the core business model.
The broader analyst community shares this constructive outlook. According to TipRanks data, the average 12-month price projection stands at $387.68—implying a 14.25% gain. The overall rating remains at Strong Buy.
While Cramer’s $400 forecast exceeds the consensus, it remains below the highest analyst target of $450.
Alphabet maintains a Zacks Rank of #3 (Hold)
