Freedom: nuclear power could support Alphabet and Constellation shares

Alphabet (GOOGL) is close to signing a multi-year agreement with Constellation Energy (CEG) to purchase nuclear power worth $1+ billion, Oninvest reports, citing Bloomberg. The supplies are intended for Google data centers. The companies have not yet confirmed the terms of the deal.

Freedom Broker analyst Vladimir Chernov believes that long-term nuclear power supplies could make Google’s electricity costs more predictable and support the expansion of its artificial intelligence infrastructure. He assesses the potential agreement as a moderately positive factor for Alphabet shares. For Constellation Energy, a contract with a major technology client could ensure stable demand for electricity and strengthen cash flows.

Alphabet is Google’s parent company, combining search and advertising, YouTube, cloud services, and AI development. Constellation Energy is the largest operator of nuclear reactors in the US.

Alphabet is close to an energy deal worth $1+ billion

Alphabet is close to signing a multi-year agreement to purchase nuclear power from Constellation. According to the agency’s sources, the contract will be worth at least $1 billion, and it could be announced as early as this week.

How nuclear power could help Google

In Chernov’s view, the agreement is strategically important for Google’s fast-growing data centers. Reliable power supply is necessary to run servers, train AI models, and process user requests.

Nuclear generation reduces dependence on fossil-fuel price swings. If a long-term contract locks in predictable purchasing terms, Alphabet will be able to plan operating expenses and the expansion of computing capacity more accurately.

The analyst views this as a moderately positive signal for Alphabet shares: energy availability is becoming one of the prerequisites for further growth of the cloud business and AI services.

Constellation will gain long-term demand from a major client

For Constellation, a multi-year contract with a technology holding company could provide more устойчивый demand for electricity and strengthen cash flows, Chernov believes. This could support the energy company’s share price.

In the analyst’s opinion, technology companies’ interest in long-term contracts with nuclear power plants creates prerequisites for a higher market valuation of nuclear energy. For buyers, such agreements reduce power-supply risks, while for producers they reduce uncertainty about future sales.

Power supply is becoming a constraint on AI development

Earlier, Freedom Broker warned that a shortage of available power grids could limit AI growth as early as the winter of 2026–2027. Analysts noted that increased purchases of servers and components do not guarantee the timely launch of data centers: new facilities need connections to electrical capacity.

At the same time, constraints may increase investor interest in power equipment and generation sources capable of ensuring further expansion of computing infrastructure.

In September, Freedom Broker also selected Alphabet as its investment idea of the week with a target price of $400 over a two-month horizon. At the time of publication, this implied an upside potential of 18.2% versus the $338.40 quote.

Among their arguments, analysts highlighted the development of the cloud business and the commercialization of proprietary AI technologies. They viewed the increase in capital expenditures as a factor weighing on the stock, so returns on infrastructure investments remain important for valuing the company.

Not an individual investment recommendation.