NVIDIA (NASDAQ:NVDA) is poised for a steep market-value decline on Tuesday after a report indicated that Meta Platforms (NASDAQ:META) is weighing a potential shift toward Google-designed chips for its future data centers — a move that could reshape the competitive dynamics of the AI hardware sector.
According to The Information, Meta is evaluating whether to adopt Google’s tensor processing units (TPUs) starting in 2027 and may begin renting TPU capacity through Google Cloud as soon as next year.
Shares of Nvidia slid 4.1% in premarket trading following the report, putting the company on track to lose roughly $180 billion in market capitalization.
Alphabet (NASDAQ:GOOGL), meanwhile, surged 4% premarket, positioning the Google parent to approach a $4 trillion valuation. Google rolled out its first TPU in 2018 for internal AI workloads and has since developed multiple generations optimized for increasingly compute-heavy AI models. Analysts say this specialization gives Google an efficiency advantage over competing chips.
A potential chip deal with Meta would serve as a significant validation of Google’s technology and represent an uncommon instance of a major AI player choosing a supplier outside of Nvidia’s dominant ecosystem.
Broadcom (NASDAQ:AVGO) also benefited from the news, reflecting its central role in AI infrastructure. The stock jumped 11.10% on Monday and was up another 2.5% in early trading Tuesday.