Nvidia's shares have significantly declined following reports of Meta potentially collaborating with Google on AI chips. Meta is considering using Google's Tensor Processing Units (TPUs) in its data centres by 2027 and may also rent chips from Google's cloud division next year. This move signals growing competition in the AI chip market, where Nvidia has been a dominant player.
Google's TPUs are custom-built AI accelerators designed for the mathematical operations at the core of machine learning. Meta's interest in TPUs stems from a desire for diversification and potential cost savings. While Nvidia remains a leader in the AI chip market, the potential deal between Meta and Google highlights the increasing interest in alternative solutions.
Nvidia has stated that they are still the leader in the industry and that their platform runs every AI model. They also claim to offer greater performance, versatility, and fungibility than ASICs like TPUs, which are designed for specific AI frameworks. Despite this, the news has positively impacted Google's parent company, Alphabet, while also causing declines for Advanced Micro Devices (AMD).
