Alphabet (GOOG, GOOGL) released Gemini 4 Argon on Wednesday, its most advanced AI model to date, with major upgrades in programming, cybersecurity, and complex professional work. The rollout coincides with fresh evidence that AI hardware demand remains unbroken: TSMC (TSM), which manufactures advanced AI chips for Alphabet, has sold out its capacity through the first half of 2028.

The model set a record in real-world software engineering tests, tied for first place in cybersecurity benchmark tests, and ranked first in a separate benchmark measuring performance in finance, law, and other professional tasks.

Internal deployment already underway

Google said it has used Argon internally to optimize data center memory, freeing up hundreds of terabytes of memory without additional hardware purchases. Quantum computing researchers have also worked with the model.

The company plans a phased launch. Argon goes first to trusted cybersecurity partners while Google works with the U.S. government on pre-release security assessments.

Tulsee Doshi, Google's product lead for the Gemini model, said the staged rollout gives the company more confidence and lets it quickly place a trained model with strong cyber defense capabilities into the hands of defenders.

The release came one day after Google CEO Sundar Pichai signed a voluntary agreement at the White House with U.S. President Donald Trump and major technology executives. The parties had earlier held a luncheon to discuss rising AI safety concerns.

Sold-out capacity signals sustained demand

Alphabet's stock rose 2.8 percent as of 11:20 a.m. Eastern Time on Wednesday, as Piper Sandler issued an optimistic forecast for the AI industry.

TSMC's sold-out order book carries two implications. First, the AI buildout is unlikely to slow in the short term. AI hyperscalers continue to buy chips and memory in large volumes, often purchasing ahead of schedule to lock in future supply. Alphabet ranks among the largest hyperscalers, so its AI business continues to thrive.

Second, Alphabet has moved beyond buying chips. With its TPU (Tensor Processing Unit) line — designed by Google and manufactured by TSMC — the company now supplies AI silicon as well. TPU sales began generating revenue for Alphabet last quarter.

Piper Sandler estimates that GPU and ASIC shipments, including Google's TPU, will total 14 million units this year, grow 50 percent in 2027, and add another 40 percent in 2028. ASICs alone will account for 66 percent of those shipments.

Valuation and outlook

Alphabet's market capitalization stands at $4.1 trillion. With more than $244.2 billion in trailing twelve-month earnings, the price-to-earnings ratio sits at 16.8 times. Analysts widely expect earnings to grow 14.6 percent annually over the next five years. On that basis, the stock's valuation looks modest relative to expected growth — and the combination of the Argon launch and the TPU revenue stream reinforces the company's near-term position.