Google Sells Chips: Broadcom Up, Nvidia/AMD Down
Google TPU Ironwood vs Nvidia: 9,216-chip AI pods, 4.6 PFLOPS, 1.77 PB HBM—ASICs now rival GPUs.
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Reports indicate that Google’s parent company, Alphabet, is in talks with companies, including Meta Platforms, hoping they will adopt Google’s Tensor AI chips (TPU). This move will intensify its competition with Nvidia. Following the news, Google and its AI chip partner Broadcom saw gains in after-hours trading, while Nvidia and AMD shares declined.
Historically, Google has used its Tensor Processing Units (TPUs) in its own data centers and then rented capacity to customers. However, according to a late Monday report by The Information, Google has now begun directly selling TPUs to customers for use in their own data centers.
The report states that Meta Platforms is considering purchasing billions of dollars’ worth of Google TPUs for its data centers starting in 2027, while potentially renting TPU capacity from Google Cloud as early as 2026. Meta has traditionally relied heavily on Nvidia GPUs to meet its AI needs.
For Google and Broadcom (which participates in the design of Tensor AI chips), this could open up a massive new market. But it also poses a significant competitive threat to Nvidia and AMD, potentially challenging their enormous sales volumes and pricing power.
Influenced by The Information’s report, Google shares rose more than 2% in after-hours trading, while Broadcom gained nearly 2%, extending strong gains from the regular session.
On Monday, Broadcom surged 11.1% to $377.96, reclaiming its 50-day moving average and hitting a cup-with-handle buy point at $363.24 that investors could act on.
Google shares rose 6.3% on Monday to $318.58, hitting a new all-time high after gaining 8.4% the previous week.
Nvidia fell nearly 2% in after-hours trading. On Monday, the stock rose 2.05% to $182.55 but remained below its 50-day moving average.
AMD dropped nearly 2% after hours. On Monday, AMD gained 5.5% to $215.05, just below its 50-day line.
