Blackstone to invest $5 billion in a new AI infrastructure company formed with Google

Blackstone, the world's largest private owner of data centres, has announced a $5 billion equity investment in a new artificial intelligence infrastructure company formed in partnership with Google, the New York-based asset management firm confirmed on Monday.

The joint venture

Google will supply the new US-based company with its tensor processing units — chips purpose-built for processing artificial intelligence computations — bringing the first 500 megawatts of compute capacity online by 2027, with "plans to scale significantly over time," Blackstone said in a statement.

"This new company has enormous potential as it helps to meet the unprecedented demand for compute," said Jon Gray, President and COO of Blackstone.

Leadership and ownership

The as-yet-unnamed company will be led by Benjamin Treynor Sloss, who most recently served as Google's chief programmes officer.

A Google spokesperson declined to comment on whether the company would retain a direct leadership role.

The Wall Street Journal, which first reported the deal, said Blackstone would hold a majority stake, citing sources familiar with the matter — though Blackstone did not disclose the ownership structure in its official statement. Data centre locations have already been identified, with some sites reportedly under construction.

Google's TPUs versus Nvidia's GPUs

The deal highlights the intensifying rivalry between Google and Nvidia in AI hardware. Google's TPUs have long been seen as the company's answer to industry leader Nvidia's graphics processing units.

Whilst Google continues to use Nvidia's GPUs across its cloud architecture, the company has sought to reduce its reliance on Nvidia by developing its proprietary TPUs. Google was an early proponent of in-house hardware production, manufacturing its first TPU in 2015.

Unlike GPUs, which are broadly suited for general usage, Google touts its TPUs as purpose-built for more efficient processing of a narrower set of applications, such as agentic AI. Google runs its Gemini AI model on its TPUs, with Anthropic and Citadel Securities also among its TPU clients.

Blackstone's broader AI push

Blackstone, which manages more than $1.3 trillion in assets, has invested aggressively across the AI ecosystem and earlier this month established a similar venture with Anthropic.

Shares of Alphabet and Blackstone both rose by approximately 1% in pre-market trading on Tuesday following the announcement.