New York, June 8, 2026, 15:08 (EDT)
- Alphabet Class A dropped about 1.2% in afternoon trade. Intel gained close to 13%.
- Main driver today: a report said Google has lined up over 3 million future AI chips from Intel.
- Investors are looking at AI demand but also at spending, dilution, and legal risk.
Alphabet Inc Class A shares fell on Monday afternoon, while Intel jumped after news Google would use Intel to make new AI chips. Alphabet dropped 1.2% to $363.97. Intel was up almost 13% at $112.06, latest data showed.
Investors seem divided on Google’s AI push. The market rewards demand, but cuts the stock when that demand also means big spending, more shares, or a longer wait.
Google ordered over 3 million tensor processing units from Intel for delivery in 2028, The Information reported, according to Reuters. The chips, known as TPUs, are made by Google for powering AI. Reuters couldn’t confirm the story. Intel did not comment. Alphabet and Nvidia also did not reply to Reuters.
Intel’s report read as a show of faith in its foundry unit, which produces chips for other firms. For Alphabet, it highlighted a move to broaden its AI supply lines, with Google trying to cut its dependence on Nvidia GPUs and Taiwan Semiconductor Manufacturing Co.
Jacob Bourne, a technology analyst with eMarketer, said the report shows “AI’s biggest players are racing to diversify” in a supply chain that’s still concentrated at TSMC. Gil Luria at D.A. Davidson said Google and Nvidia also want to work with Intel because of the push for U.S. chip production. Reuters
Nasdaq moved up 1.3% and the Philadelphia Semiconductor Index jumped 6.2%. Investors were back buying chip stocks after they sold off on Friday. “Bargain hunting off the big tech selloff,” Cherry Lane Investments partner Rick Meckler said, though he pointed out the market is still priced for perfection and faces swings. Reuters
Apple took the wraps off “Siri AI” at its Worldwide Developers Conference on Monday, rolling out a long-awaited upgrade for its digital assistant. Reuters reported that Apple is turning to external partners to boost the tech, including Google’s Gemini models. “Truly helpful AI must be centered around you and your needs,” Apple software head Craig Federighi said. Reuters
Apple’s Siri news is relevant to Alphabet as Gemini is more than a chatbot brand. Google and Apple said in January that future Apple Foundation Models would use Google’s Gemini models and cloud, powering new Apple Intelligence features.
Alphabet posted first-quarter revenue up 22% at $109.9 billion. Google Search and other revenue rose 19%. Cloud sales jumped 63% to $20.0 billion. CEO Sundar Pichai said AI investments were “lighting up every part of the business.” SEC
Alphabet is dealing with heavy costs. On the latest earnings call, the company reported Google Cloud backlog hit $462 billion. Alphabet bumped its 2026 capital expenditure guidance up to $180 billion to $190 billion, raising what it expects to spend on long-term assets like data centers and servers. The company said capex in 2027 would increase “significantly” again. Abc
Alphabet increased its equity offerings to $84.75 billion last week and stuck with its $10 billion private placement with Berkshire Hathaway, along with a $40 billion at-the-market program. The bigger raise points to the size of its AI push but also flagged fresh dilution risk for existing holders.
But the risk is clear. If AI revenue comes in slower than hoped, Alphabet could have to justify heavy spending while its share count keeps climbing. The Intel project is still years from launch. Google is also under legal pressure. It has appealed a U.S. court decision on illegal monopolies in search and ads, with the Justice Department set to argue in July.
For now, markets aren’t shunning Google’s AI push. They are just repricing the cost.
