We just covered the 10 Best Pick and Shovel AI Stocks to Buy for the Long Term. Alphabet Inc (NASDAQ:GOOGL) ranks #4 (see 5 Best Pick and Shovel AI Stocks to Buy for the Long Term).
Short Interest: 1.4%
TPUs and Google Cloud make Alphabet Inc (NASDAQ:GOOGL) a notable pick-and-shovel name that also benefits from the AI consumption layer.
TPUs (Tensor Processing Units) are custom-built AI accelerator chips developed by Alphabet Inc (NASDAQ:GOOGL) specifically for machine learning workloads. These chips are optimized for high-efficiency, low-cost AI computation inside Google’s ecosystem. The focus is not maximum flexibility, but maximum efficiency per dollar of compute.
Their demand is expected to increase because companies are increasingly looking for dedicated AI compute resources tailored for training and running large models at scale.
Google Cloud is another reason Alphabet Inc (NASDAQ:GOOGL) can be considered a pick-and-shovel AI beneficiary. It provides the infrastructure layer for AI development, including compute, storage, networking, and managed AI platforms where companies train and deploy models. Through Google Cloud, customers can access TPUs, GPUs, and full AI development environments without building their own data center infrastructure.
Recently, Google Cloud reported over 60% year-over-year growth (latest reported quarter), with AI-driven demand becoming a key contributor to that acceleration.
L1 Capital International Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q1 2026 investor letter:
Portfolio adjustments during the March 2026 quarter were relatively modest, but deliberate. We trimmed investments in AerCap, Alphabet Inc. (NASDAQ:GOOGL), HCA Healthcare and Weir Group at prices around the top end of our assessed fair value range, with all of these businesses benefitting from positive sentiment intra-quarter. Alphabet’s share price has more than doubled over the past 12 months. This reflects …. (Click Here to Read the Letter in Detail).
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While we acknowledge the risk and potential of GOOGL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than GOOGL and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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