Google and Blackstone have launched a new AI cloud venture focused on expanding access to Google’s TPU chips as demand for AI infrastructure and compute power continues to surge globally. Earlier this month, Blackstone also partnered with Anthropic and Goldman Sachs to form a new $1.5 billion artificial intelligence services company to deploy Claude to mid-sized businesses across sectors.
As part of this partnership, Blackstone is making an initial equity investment of $5 billion in the company, which will offer data centre capacity, operations, and networking, along with Google's custom Tensor Processing Units (TPUs) as a compute-as-a-service offering.
The expects to bring the first 500 megawatts of capacity online in 2027, with plans to scale significantly over time. Apart from TPUs, Google will also supply software and services to the new company. Google has previously signed multi-billion-dollar agreements with companies such as Anthropic and Meta to provide access to its TPUs.
“This joint venture with Blackstone helps meet growing demand for TPUs, which are optimized specifically for efficiency and performance in the AI era. Together, we’re accelerating AI transformation and providing more options for organizations to access accelerated compute capability,” said Google Cloud CEO Thomas Kurian.
Google veteran Benjamin Treynor Sloss, who has over two decades of experience building and operating the tech giant’s global infrastructure and operations, will serve as the CEO of the new venture.
Jasvinder Khaira, Head of Blackstone N1 (BXN1), said, “Capital alone doesn’t build category-defining platforms – the right partner, the right structure, and the conviction to underwrite singular opportunities do. Google’s TPUs, a decade in the making and foundational to the AI economy, are exactly the kind of platform BXN1 was built to back.”
Blackstone N1 is a new unit of Blackstone that focuses on its portfolio of investments in the AI ecosystem and high-growth technology sector.
This launch is expected to help Google further accelerate the rapid growth momentum witnessed by Google Cloud in recent quarters and monetize its multi-billion dollar investments in AI compute infrastructure. Last month, Google unveiled its eighth-generation TPU, marking the first time the company introduced a dedicated inference chip, called TPU 8i. The move comes amid rising demand for inference capabilities as customers deploy frontier AI models into production at scale.
It also introduced TPU 8t, a specialized chip optimized for massive model training. At launch, Amin Vahadat, chief technologist for AI infrastructure at Google, said TPU 8t is built to reduce the frontier model development cycle from months to weeks.
Blackstone, which has over $1.3 trillion in assets under management and is the largest global provider of data centres, stated that the joint venture will give customers more choice and flexibility for running their AI workloads on TPUs.
“We see a generational opportunity to invest capital at scale building AI infrastructure. This new company has enormous potential as it helps to meet the unprecedented demand for compute," said Jon Gray, President and COO of Blackstone.
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Google is partnering with Blackstone not just to form a new AI cloud company but also in a bid to expand the availability of its custom AI chips and challenge Nvidia’s market dominance. Google parent Alphabet recently raised its capital expenditure plans for the year 2026 to $180 billion-$190 billion, up from its previous guidance of $175 billion-$185 billion.
The deal comes at a time when demand for computing power is exploding. Companies building AI models, ranging from startups to global enterprises, require vast data centre capacity to train and deploy systems.