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Google Stock Up Over 10%: How AI and TPUs Are Driving the Rally
Alphabet (GOOGL) kicked off the week with a sharp rebound, as its share price surged over 6% on Monday and added another 4% in pre-market trade, according to Google Finance. This momentum quickly spilled over into other AI-linked stocks, including Broadcom, Micron, and AMD, which advanced up to 11%, signaling a broader rotation back into the AI sector. The question on every investor’s mind: why is Google stock rising now?
This is not just a one-off spike; it reflects a deeper shift in market perception regarding Google’s position in the AI ecosystem and its competitive stance against Nvidia.
Gemini 3 Strengthens Google’s AI Leadership
A major catalyst behind Alphabet’s rally is the Gemini 3 model, which Bloomberg reports offers improved reasoning, multimodal capabilities, and enhanced agent-like workflows. Benchmarks indicate significant gains over the previous generation, particularly in visual understanding, coding, and academic problem-solving.
What sets this apart is Google’s decision to integrate Gemini directly into Search at launch, signaling a meaningful move to embed AI into its core revenue streams. This integration positions Alphabet to monetize AI more effectively across advertising, productivity tools, and cloud workloads. Gemini is also rolling out across the Gemini app, AI Mode in Search, and Google’s developer ecosystem, showing the market a cohesive AI strategy for the first time in nearly a year.
Alphabet TPUs Gain Traction as a Credible Nvidia Alternative
Investor confidence is also growing around Alphabet’s tensor processing units (TPUs). Reports indicate Meta is in early discussions to deploy Google TPUs in its data centers by 2027 and may even rent TPU capacity via Google Cloud as early as next year.
If realized, this would mark one of the first large-scale non-Nvidia AI deployments by a major tech company, giving Alphabet a strategic advantage across hardware, software, and cloud infrastructure, while placing competitive pressure on Nvidia.
Market Sentiment Shifts in Alphabet’s Favor
Just a year ago, Alphabet appeared behind in the AI race following the rise of ChatGPT. Now, sentiment has changed due to:
- Expansion in Search and Ads, Alphabet’s strongest revenue engine
- Competitive growth in Google Cloud driven by AI workloads
- Clearer monetization of Gemini and agent-driven workflows
- Disciplined, shareholder-friendly capital allocation
Adding to the bullish narrative, billionaire George Soros increased his GOOGL holdings by over 631,000 shares in Q3, signaling renewed institutional confidence.
Broader Market Impact
Alphabet’s surge revitalized the AI trade, pushing the Nasdaq to its best day in nearly six months. However, analysts caution that rapid gains could introduce pockets of volatility for other companies competing in AI infrastructure.
Search interest in Google stock has increased by 171% in India over the last 30 days, according to INDmoney data. Based on a consensus of 62 analysts, 82.26% recommend a BUY, with an average target price of $322.52, above its last closing of $318.54.
What This Means for Investors
The rally highlights Alphabet’s transformation from a model developer into a serious AI infrastructure player. With continued execution and adoption of Gemini, as well as TPU expansion, Google stock momentum is likely to stay on investors’ radar in the coming months.
