Alphabet, the parent company of Google, is developing a new server chip aimed at enhancing the efficiency of its proprietary Gemini models.

The upcoming chip, referred to internally as “Frozen v2,” is expected to launch sometime in 2028, according to a report by The Information, which cites unnamed sources. The report indicates that this chip could achieve efficiency levels between six and ten times higher than Google’s current AI chips, based on the tokens produced per energy unit.

In a statement to TechCrunch, the company did not explicitly confirm the report. It also did not refute it.

“Our teams are continually researching and testing new innovations to provide optimal performance and efficiency for our users and clients,” Google informed TechCrunch. “Though not every initiative advances to production, this thorough investigation is fundamental to our comprehensive approach. By co-developing our hardware and software from inception, we guarantee our systems are integrated and highly optimized for practical workloads.”

AI firms are increasingly attempting to manufacture their own chips to enhance the operation of their internal models and to tackle global shortages in AI computing power. This efficiency has become a crucial selling point for technology companies as worries about AI expenditures have tempered the previously exuberant market atmosphere. Concurrently, companies are striving to reduce their reliance on chipmaker Nvidia, which has historically held a dominant position in the AI chip sector, leaving major AI developers dependent on its technology.

In June, OpenAI unveiled its inaugural custom chip, an inference processor named Jalapeño. Recently, reports indicated that Anthropic is in talks for a new chipmaking collaboration with Samsung.

Investors have previously expressed concerns regarding Alphabet’s substantial planned investments aimed at advancing its AI strategy. Earlier this year, Google announced plans to invest between $180 billion and $190 billion. With significant funds involved, the company needs to demonstrate that these investments will yield positive returns.

News regarding the more efficient Frozen v2 chip seems to have calmed investors, providing Google with momentum ahead of its earning report scheduled for later this week. Following The Information’s report, the company’s stock rose approximately 3% on Monday morning.