Alphabet began recording TPU sales in the second quarter, a new revenue stream that could become a growth driver and affect Nvidia and Broadcom. The company posted second-quarter results on July 22, with Google Cloud sales at $24.8 billion, 82% higher than the year-ago period, accelerating from 63% growth in the previous quarter, and ending with a $514 billion cloud backlog. Alphabet has relied on TPUs, custom AI chips, in its cloud segment and still orders chips from external suppliers. CEO Sundar Pichai said earlier this year the company would start selling TPUs to select outside customers due to soaring demand, and management announced during the second-quarter earnings call that revenue from these sales had started. The sales are likely a minuscule part of total revenue for now, but could become another source of top-line growth, putting Alphabet in direct competition with Nvidia. Custom chips are cheaper than Nvidia's GPUs and effective for their designed workloads, also helping companies reduce exposure to Nvidia. Broadcom has worked with Alphabet to design TPUs, with a long-term deal extending through 2031, so TPU sales growth would benefit Broadcom. While the TPU business may become an important driver, there is significant uncertainty, and the company's Cloud business remains a stronger reason to consider the stock.