Google pledges to invest $44 billion in guarantees for data center leasing projects.

According to a report from The Information, Google (GOOG.O) disclosed last week that it has agreed to cover third-party data center lease payments worth up to $44 billion if its tenants default. This figure marks an increase from $65 billion as of the end of September, reflecting Google’s efforts to supply its own alternative to NVIDIA’s AI chips to firms like Anthropic. Google has taken on these commitments, known as "backstop guarantees", to scale up its TPU sales. Two sources revealed that Google made these commitments based on the consideration that revenue from TPU sales would exceed the financial obligations stemming from guaranteeing data center leases to house the chips. One source said company executives are confident this financial calculation is beneficial to Alphabet. The report notes that Alphabet has provided lease guarantees for a total capacity of roughly 2.4 gigawatts across around ten projects, all of which are still unfinished, meaning the guarantees have not yet taken effect.