Nvidia Shares Drop as Meta Considers Google’s AI Chips
Nvidia's stock fell 4.4% in premarket trading following reports that Meta is evaluating Alphabet's Tensor Processing Units for its data centers. Google's custom AI chips, designed in collaboration with Broadcom, could challenge Nvidia's dominance in the semiconductor market. Broadcom shares ROSE 2% on the news.
Meta may begin using Google's TPUs as early as 2027, with potential cloud rentals starting next year. The MOVE signals growing competition in AI infrastructure, where Nvidia's GPUs have been the industry standard. Google's vertically integrated hardware offers efficiency advantages for machine learning workloads.
While Nvidia remains the market leader, tech giants are increasingly developing in-house alternatives. The semiconductor landscape is shifting as hyperscalers seek to reduce reliance on third-party suppliers. This trend could reshape the $400 billion AI chip market over the next decade.
