Nov. 28 at 6:24 PM
Google’s TPU chips are shaking up the AI market and putting pressure on Nvidia.
The launch of Google’s Gemini 3 AI model, powered by its in-house TPUs, has driven Alphabet shares up 12% since Nov. 18, while Nvidia is down 3.4%. Meta is reportedly in talks to use TPUs for AI data centers, a space traditionally dominated by Nvidia GPUs.
TPUs specialize in deep-learning matrix calculations, offering a cost-efficient alternative to Nvidia GPUs for many AI workloads. Apple and AI startup Anthropic are among TPU users. Despite this, Nvidia remains dominant with high gross margins (73% in Q3) and a software ecosystem (CUDA) that gives it a competitive moat.
Broadcom, a TPU partner, has also benefited, gaining 16% since the Gemini launch. While competition in AI chips is increasing—with Intel, AMD, and cloud providers developing alternatives—Nvidia’s market position remains strong for now.
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