Tech giant Google (NASDAQ:GOOGL) unveiled its Axiom Arm chips at the Cloud Next conference in Las Vegas on Tuesday. These custom-built Arm-based server semiconductors are anticipated to be released later this year. This endeavor aims to enhance the affordability of cloud computing as part of Google’s strategic plan.
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When a company uses its in-house chips to provide cloud computing services, cloud service costs are reduced as these chips are more power efficient.
The tech giant is late to this initiative as its other counterparts, Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) have been employing a similar strategy for quite some time now.
While Google parent Alphabet generates a majority of its revenues from advertising, its cloud revenues are growing at a faster clip and currently comprise around 11% of its total revenues.
However, the tech behemoth still lags behind other tech giants such as Amazon and Microsoft. According to a CNBC report citing Gartner estimates, in 2022, Amazon and Microsoft collectively commanded approximately 62% of the cloud infrastructure market, whereas Google held just 7.5%.
Is Google Stock a Good Buy Right Now?
Analysts remain bullish about GOOGL stock, with a Strong Buy consensus rating based on 30 Buys and seven Holds. Over the past year, GOOGL has surged by more than 40%, and the average GOOGL price target of $165.98 implies an upside potential of 7.2% at current levels.
