Google's biggest AI showcase: What to watch

Summary

CNBC's MacKenzie Sigalos reports from Google I/O, focusing on Google's AI strategy, the TPU chip and a new Blackstone partnership, and the critical question of whether Gemini 4 will be announced. She also highlights the risk that AI search results may reduce external ad clicks.

• Google is positioning itself as the stable, vertically integrated AI player as rivals face legal battles.
• The most important product to watch at I/O is whether Google announces Gemini 4.
• Blackstone has become a major buyer of Google's TPU AI chips, a direct rival to NVIDIA's GPUs.
• Google's TPU sales to independent customers will ramp in second half of 2025 and scale in 2027.
• AI mode searches result in 93% of queries ending without an external click, challenging Google's ad revenue model.
• Google wins regardless of which AI model leads, as it also counts Anthropic as a major cloud customer.
• Other hyperscalers (Microsoft, Meta) are several years behind Google in custom silicon development.
• The TPU program is a key driver of investor and analyst bullishness on Alphabet.