Google CEO Sundar Pichai says he’s “very excited” to provide OpenAI, the search large’s largest competitor in AI, with cloud computing sources to coach and serve the corporate’s AI fashions as a part of a not too long ago struck partnership.
“With respect to OpenAI, look, we’re very excited to be partnering with them on Google Cloud,” mentioned Pichai on Google’s second-quarter earnings name on Wednesday. “Google Cloud is an open platform, and we now have a robust historical past of supporting nice firms, startups, AI labs, and many others. So tremendous enthusiastic about our partnership there on the cloud aspect, and we stay up for investing extra in that relationship and rising that.”
The remark got here shortly after analysts peppered Pichai and different Google executives with questions on how AI would have an effect on its core search enterprise and why Google is spending an additional $10 billion on capital expenditures this yr to catch up within the AI race. Roughly two and a half years because the launch of ChatGPT, Google has now shifted its focus squarely on growing main AI fashions and merchandise to compete with OpenAI.
ChatGPT is a significant menace to Google Search, however the OpenAI deal marks a large new buyer for Google Cloud. It’s a treacherous relationship for Google to navigate; OpenAI could in the end use Google’s cloud infrastructure and chips to upend the corporate’s core Search product.
Earlier this month, OpenAI quietly added Google Cloud to a public checklist of suppliers that it makes use of for cloud computing providers, alongside Microsoft and Oracle. Reuters beforehand reported in June that OpenAI was contemplating tapping Google Cloud for further computational energy.
Notably, Google Cloud income soared within the second quarter of 2025 to $13.6 billion, up from $10.3 billion in the identical quarter final yr. Google attributes a big chunk of that development to the Google Cloud Platform and different merchandise it affords to AI firms. Google Cloud continues to be a small enterprise relative to Google Search, however it appears to be rising within the AI period.
A number of massive AI labs have tapped Google Cloud as a cloud computing companion, together with Anthropic, Ilya Sutskever’s Secure Superintelligence, Fei-Fei Li’s World Labs, and now OpenAI. Pichai famous on the earnings name that the corporate has been profitable at successful offers with massive AI labs due to its massive provide of Nvidia GPU chips and in-house TPU chips.
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Google Cloud looks like a sensible companion for OpenAI. The startup is extraordinarily constrained on the subject of Nvidia GPUs, which it makes use of to coach new AI fashions and serve them to a whole lot of thousands and thousands of customers. These constraints have been a significant stress level with OpenAI’s greatest backer and largest cloud computing companion, Microsoft, forcing the ChatGPT maker to show to its rivals within the cloud market.
On the AI merchandise entrance, Google appears to be doing higher than initially anticipated. The corporate mentioned its AI chatbot, Gemini, now reaches 450 million month-to-month energetic customers, and AI Overviews reaches 2 billion month-to-month energetic customers. Nonetheless, the enterprise round these merchandise stays unclear, as does the share of queries they’re taking from Google Search.
It’s onerous to think about that Pichai is actually that enthusiastic about working with OpenAI, an organization that represents the largest menace Google Search has ever confronted. The partnership is harking back to Google’s take care of Yahoo from many years in the past, when it was only a startup, and used Yahoo’s homepage as an accelerant to overhaul it because the entrance door to the web. How lasting OpenAI’s relationship with Google is stays to be seen.
