Google is many things, but one thing it is not in the most literal sense is a hardware manufacturer. That's not to say Google hasn't developed hardware in-house before, but simply that they are first and foremost, a software company, with a handful of different hardware products on offer like the Pixel line of devices as well as the Chromecast. Now, it seems, that Google may be looking into potentially co-developing a series of microchips for future Android devices in an attempt to better compete with Apple at the top-tier end of the spectrum, and to possibly lessen the amount of fragmentation currently found within the Android operating system.
According to details on the matter, Google recently held talks with potential partners about creating a series of chips based on designs Google would like to use for devices in the future. If Google is able to convince a hardware partner or partners to hop on board, their hope is to use these chip designs in the co-development process that would allow them introduce new functionality to Android that may not be currently possible or available. Although exact details or specifics are still unclear, included in the designs Google is said to have showcased to partners is a potential CPU to be used in upcoming devices. Whether or not these would be strictly for use inside of Google's own series of devices, such as those in the Nexus or Pixel lineups, is not currently known at this time.
Alongside a potential CPU, Google is said to be exploring the possibility of chip designs for cameras as well as application processors. It's thought that Google has plans to finalize the chips for use in devices and the Android OS within a few year's time, so it isn't likely Google will have anything ready for consumers in the immediate future or even next year. Having said that, a series of processors which Google helped design and develop would make for a perfect display at an upcoming Google I/O, Google's annual developer conference where they typically display or discuss what they're working on for the remainder of the year and forward.