"A deal would signal growing momentum for Google's chips and long-term potential to challenge Nvidia's market dominance, after the company earlier agreed to supply up to 1 million chips to Anthropic PBC. Google owner Alphabet Inc. is on track to hit a $4 trillion market valuation for the first time when trading opens in New York on Wednesday. Nvidia's shares were down about 4% in premarket trading."
"An agreement would help establish TPUs as an alternative to Nvidia's chips, the gold standard for big tech firms and startups from Meta to OpenAI that need computing power to develop and run artificial intelligence platforms. Nvidia's stock is already facing headwinds as investors fear a broader AI bubble. Michael Burry, immortalized in The Big Short for his bets against the housing market during the 2008 financial crisis, has scrutinized the chipmaker over circular AI deals, hardware depreciation and revenue recognition."
Meta is negotiating to spend billions on Google's tensor processing units (TPUs) for use in data centers in 2027 and may rent chips from Google Cloud as early as next year. An agreement would bolster TPUs as an alternative to Nvidia's GPUs, which currently dominate AI compute for large tech firms and startups. Google previously agreed to supply up to 1 million chips to Anthropic. Alphabet is approaching a $4 trillion market valuation, while Nvidia shares fell about 4% in premarket trading. Investor concerns about an AI-driven market bubble and scrutiny from figures like Michael Burry are pressuring Nvidia's stock.
Read at www.mercurynews.com
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