Google is gaining momentum in the global artificial intelligence race after years of concerns that it lagged behind rivals. New software, growing cloud demand and interest in its custom chips have lifted investor confidence and pushed Alphabet Inc.’s market value toward $4 trillion.

The company’s latest model, Gemini 3, received strong early reactions for its performance in reasoning, coding and specialized tasks that have challenged other chatbots. The progress follows a series of partnerships, including a large-scale chip agreement with Anthropic PBC.

Google’s shares rose more than 3% on Tuesday after a report that Meta Platforms Inc. was in talks to adopt Google’s processors. The stock has added nearly $1 trillion in value since mid-October, supported by a new stake from Warren Buffett and broad enthusiasm for Google’s AI work. SoftBank Group, a major OpenAI investor, fell to a two-month low on concern over Google’s advances. Nvidia shares also dropped on Tuesday, erasing $243 billion in market value.

Google executives have long argued that sustained research investment would defend its leadership in search and help create new computing platforms. The rise of ChatGPT challenged that position, but Google maintains advantages in data, profits and infrastructure. CEO Sundar Pichai told investors the company is committed to a full-stack AI strategy.

Regulatory worries have eased after Google avoided a breakup in a recent US antitrust case. Alphabet’s Waymo unit is expanding to new cities and has added freeway driving to its autonomous taxi service.

Google’s ability to build hardware, models, cloud systems and consumer applications offers cost and operational benefits. Demand for its tensor processing units is increasing. Anthropic plans to use up to 1 million TPUs, and Meta is considering using the chips in 2027, according to the Information. Google said demand is rising for both its chips and Nvidia’s GPUs.

Gemini 3 Pro now leads several industry benchmarks. Google reports 650 million Gemini app users, compared with ChatGPT’s 800 million weekly users. Google Cloud revenue rose 34% in the third quarter to $15.2 billion, though it still trails Microsoft and Amazon.

Analysts say Google’s resurgence reflects its strengthened position. One described the company as a “sleeping giant” that is now fully engaged in the AI race.