What is Google's Growth Engine theme all about?

Google's Growth Engine is a carefully curated collection of 15 stocks representing companies that supply critical technology and infrastructure to Alphabet (Google's parent company). These companies provide everything from advanced semiconductors and GPUs to servers, networking equipment, and data storage solutions that Google needs for its massive AI and cloud computing initiatives. As Google invests billions to maintain its technological edge, these suppliers directly benefit from that spending.

What are GPUs and why are they important for Google?

GPUs (Graphics Processing Units) are specialized computer chips originally designed for rendering graphics but now essential for AI and machine learning. Unlike traditional CPUs, GPUs can perform many calculations simultaneously, making them perfect for the complex mathematical operations needed to train and run AI models. Companies like NVIDIA and AMD supply these crucial components to Google, which needs massive amounts of GPU power for its AI research, search algorithms, and cloud services.

What is a semiconductor foundry?

A semiconductor foundry is a factory that manufactures computer chips designed by other companies. Taiwan Semiconductor Manufacturing Company (TSM) is the world's largest foundry and produces cutting-edge chips for many tech companies, including those that supply Google. Foundries require extremely sophisticated equipment from companies like ASML to create the tiny, intricate circuits that make modern computing possible. As Google expands its technological capabilities, it depends on this semiconductor supply chain.

What does "picks and shovels" mean in investing?

The phrase "picks and shovels" refers to an investment strategy inspired by the California Gold Rush, where suppliers of essential tools (like picks and shovels) often made more reliable profits than the gold miners themselves. In modern investing, it means focusing on companies that provide essential tools, components, or services to a booming industry rather than betting on which end-product company will win. In this theme, instead of investing directly in Google, you're investing in the companies that provide the critical technology Google needs to operate and grow.

What are DRAM and NAND memory chips?

DRAM (Dynamic Random Access Memory) and NAND are two important types of computer memory that serve different purposes. DRAM provides the temporary, fast memory that computers need to run applications, while NAND provides permanent storage (like in your phone or SSD drive). Companies like Micron Technology (MU) produce these essential components that are needed in large quantities for data centers. As Google processes more data and runs more AI models, the demand for these memory chips increases.

15 handpicked stocks

Google's Growth Engine

As Google pours billions into AI and cloud infrastructure, a select group of technology suppliers are reaping the rewards. These carefully chosen stocks represent the companies providing the essential hardware and technology that power Alphabet's ambitious growth plans.

Han Tan | Market Analyst

Published on June 30

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

NVIDIA Corporation

NVDA

Current price

$188.95

As the leading designer of GPUs, its hardware is essential for training the large-scale AI models that power Google's core services and cloud offering...

As the leading designer of GPUs, its hardware is essential for training the large-scale AI models that power Google's core services and cloud offerings.

Advanced Micro Devices, Inc.

AMD

Current price

$170.56

A key supplier of high-performance CPUs and increasingly competitive GPUs for data centers, benefiting from Google's need to diversify its hardware su...

A key supplier of high-performance CPUs and increasingly competitive GPUs for data centers, benefiting from Google's need to diversify its hardware supply chain.

Taiwan Semiconductor Manufacturing Co.

TSM

Current price

$288.21

The world's largest semiconductor foundry, responsible for manufacturing the cutting-edge chips that Google's AI and cloud infrastructure depend on.

ASML Holding NV

ASML

Current price

$1,030.17

Super Micro Computer, Inc.

SMCI

Current price

$52.49

Arista Networks, Inc.

ANET

Current price

$144.45

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About This Group of Stocks

Our Expert Thinking

While investors debate Alphabet's future in AI, the company is investing massively in its technological infrastructure. This creates a powerful opportunity in the essential suppliers that provide the "picks and shovels" of Google's digital expansion—from advanced semiconductors to critical data center hardware.

What You Need to Know

These companies operate at the foundational level of the tech supply chain, manufacturing the essential components that make Google's services possible. They're direct beneficiaries of Alphabet's multi-billion dollar infrastructure investments, positioning them for potential growth regardless of which tech giant ultimately leads in AI.

Why These Stocks

Each company in this group has been identified for its role in providing mission-critical hardware or infrastructure that Google depends on. From chip designers and manufacturers to networking and data storage specialists, these firms are indispensable to Alphabet's technological ambitions.

Group Performance Snapshot

13 of 15

Stocks Rated Buy by Analysts

13 of 15 assets in this group are rated Buy by professional analysts.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

💰

Following The Money

These companies are on the receiving end of Alphabet's multi-billion dollar infrastructure spending spree. As Google doubles down on AI, these suppliers stand to benefit directly from this massive capital flow.

🔍

Hidden Tech Heroes

While headlines focus on tech giants like Google, these essential suppliers often fly under the radar. They provide the critical components that make AI and cloud services possible, offering potentially overlooked investment opportunities.

🌐

Riding The AI Wave

Google's urgent push into AI and cloud computing is creating ripple effects throughout the tech ecosystem. These companies are positioned at the foundation of this technological transformation, regardless of which tech giant ultimately leads.

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