Key takeaways
- Meta signs a $10 billion cloud deal with Google to enhance AI infrastructure.
- Partnership aligns with Meta's strategy to invest hundreds of billions in AI data centers.
- Meta raises its annual capital expenditure forecast by $2 billion to support growth.
- Google Cloud experiences significant revenue growth, reflecting rising AI demand.
- The deal represents a collaboration trend among tech rivals in the evolving cloud market.
Meta has signed a six-year cloud computing agreement with Google, valued at more than $10 billion, The Information has reported. The deal, which covers servers, storage, networking and other services, marks Google Cloud’s second major win in recent months following its agreement with OpenAI.
The partnership comes at a time when Meta is rapidly scaling its AI infrastructure. In July, CEO Mark Zuckerberg announced that the company would invest “hundreds of billions of dollars” in building massive AI-focused data centres. Earlier this year, Meta disclosed plans to offload $2 billion worth of data centre assets to external partners to help finance the effort.
Meta also lifted its capital expenditure guidance last month, raising the lower end of its forecast by $2 billion to between $66 billion and $72 billion for the year.
Google’s cloud division, meanwhile, is seeing strong growth amid the AI investment race. Parent company Alphabet reported a 32% year-on-year jump in second-quarter cloud revenue in July, beating Wall Street expectations.
The Meta-Google deal shows how the surge in AI demand is reshaping the cloud computing market, pushing once-rival firms into unexpected collaborations to secure computing capacity.
In other news, Google is extending its Tensor Processing Units (TPUs) to the Indian government. According to IndiaAI Mission chief executive Abhishek Singh, the third phase of the programme’s GPU tender will add around 3,850 units. For the first time, the mission has also obtained 1,050 of Google’s Trillium TPUs.
