Alphabet (GOOGL) and Meta join forces to weaken Nvidia's (NVDA) software dominance
Google (GOOGL), a subsidiary of Alphabet, is collaborating with Meta Platforms (META) on a new initiative aimed at enhancing the performance of its artificial intelligence chips to surpass similar products from Nvidia (NVDA). According to sources familiar with the matter, the goal of this initiative is to make Google’s AI chips perform better when running PyTorch. PyTorch is the world’s most widely used artificial intelligence software framework, is open source, and is strongly supported by Meta Platforms. It is also one of the most commonly used tools for developers building AI models.
Alphabet (GOOGL) has recently attracted attention due to its self-developed Tensor Processing Unit (TPU). Several experts predict that Alphabet’s TPU is likely to become a major driver of its revenue growth and push GOOGL’s stock price higher. These dedicated chips have long been a cornerstone of Google Cloud, and investors are increasingly recognizing that selling them externally could become a profitable extension of this strategy.
A Google Cloud spokesperson declined to comment on the details of the collaboration with Meta. However, a spokesperson confirmed to Reuters that this move will provide customers with more options. The spokesperson stated: “We are seeing tremendous growth in demand for both TPU and GPU infrastructure, and the growth rate is astonishing. Our focus is to provide developers with the flexibility and scalability they need, regardless of which hardware they choose to use.”
Alphabet is well positioned for growth, especially in its AI chip technology, with analysts valuing it as high as $900 billions. In addition, several top Wall Street institutions have recommended buying GOOGL stock and expect its price to reach record highs in the coming months. This could indicate that this Google developer is poised to lead the “Magnificent Seven” list for a second consecutive year.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Equity Futures Largely Steady Pre-Bell; Oil Falls Amid Growing Optimism for Middle East Resolution
Valuation drops to a ten-year low! Jensen Huang calls Nvidia the "world's first growth-value stock", but investors don't seem convinced
Nvidia's price-to-earnings ratio has dropped below 17 times, which is only about half of its projected 2025 level. Although revenue and net profit for fiscal year 2027 are expected to grow by 90% and 99% respectively, the company's stock has risen only about 20% this year, significantly lagging behind the Philadelphia Semiconductor Index. Meanwhile, gross margin is expected to decline from 75% in the second quarter to below 72% in the fourth quarter. Rising memory costs and continued pressure from customers developing their own chips, as well as uncertainty over future AI capital expenditures, have become key factors for the market to reassess Nvidia's valuation.
Bitcoin Hashrate Stalls at 934 EH/s — Miners Are Leaving for AI
Crypto prices
More
