Nvidia shares dropped by up to 3% following reports of Meta Platforms potentially investing billions in Google’s AI chips, challenging Nvidia’s dominance in AI accelerator chips. Meta is reportedly in talks to utilize Google’s tensor processing units (TPUs) for its data centers by 2027 and may also rent these chips from Google’s cloud division in 2024. This potential collaboration could establish Google’s TPUs as a credible alternative to Nvidia’s AI chips, frequently used by companies like OpenAI. Google’s parent company Alphabet Inc. saw a 2.4% stock increase after reports of Meta’s potential interest, buoyed by optimism over its latest Gemini AI model. Google previously secured a deal to supply up to 1 million TPUs to Anthropic PBC, which has been seen as significant validation of their chips. Analysts suggest that Meta’s likely move towards using TPUs indicates the increasing reliance on Google as a secondary source for accelerator chips among larger companies. Meta’s anticipated capital expenditure of over $100 billion by 2026 suggests significant investment in TPUs and computing power in the immediate future. Asian stocks related to Alphabet surged, notably with South Korea’s IsuPetasys Co. and Taiwan’s MediaTek Inc. making substantial gains due to their supply links to Alphabet. If successful, Google’s TPUs could become a viable long-term option for AI tasks, marking a potential win against Nvidia, whose GPUs currently dominate the sector. Google’s TPUs, designed specifically for AI tasks, are gaining traction as a strategic alternative amid global concerns over overreliance on Nvidia. #AIChips #MetaGoogleDeal #NvidiaFall #TensorProcessingUnits #AIInnovation
...