Google Puts AI Chips in Orbit as Project Suncatcher Takes Off

Google is pushing its artificial intelligence (AI) chips into space as part of Project Suncatcher. The company's in-house Trillium Tensor Processing Unit (TPU) chips will be sent to low Earth orbit via SpaceX's Transporter-18.

Google plans to build AI infrastructure in space, with the goal of putting scores of its TPUs there. This recent news hasn't been enough to boost GOOGL stock yet, which remains up 9% on a year-to-date basis and underperforms the S&P 500's rise of 12%.

Google's TPU business is gaining momentum, with partners like Anthropic and Apple headlining the customer base. The second quarter of fiscal 2026 was the first period in which Google recognized revenue from its TPU sales, as Google Cloud's order backlog surged to $514 billion in Q2 2026 from $106 billion in Q2 2025.

Morgan Stanley expects Google to sell 1 million TPUs, with 3.2 GW deployed in 2027 and 4.2 GW deployed in 2028. This implies revenue of $84 billion in 2027 and $108 billion in 2028. Crux AI, a dedicated AI cloud venture formed as a strategic partnership between Google and Blackstone, is designed to build massive, specialized infrastructure to meet the exploding demand for AI computing capacity.

Crux AI plans to bring its first 500 megawatts of dedicated AI data-center capacity online by 2027. Alphabet's Q2 2026 report was a hit, despite a slight earnings miss. Revenue rose 24% year-over-year (YOY) to $119.8 billion, marking the company's 12th-straight quarter of double-digit growth.

Google Cloud saw revenue increase 82% YOY to $24.8 billion, also coming in ahead of the consensus estimate of roughly $22.3 billion. Adjusted EPS of $2.85 may have missed estimates, yet diluted EPS came in at $9.11, marking sizable 294% YOY growth.

Analysts remain gung ho on GOOGL stock, with a consensus 'Strong Buy' rating and mean target price of $432.49 indicating potential upside of 27% from current levels.