Nvidia said it is “a generation ahead” of rivals in the artificial intelligence (AI) industry, amid growing speculation that a rival could emerge to threaten its market dominance – and multi-trillion-dollar valuation.
Shares of the chip giant fell on Tuesday after a report that Meta plans to spend billions on artificial intelligence chips developed by Google to power its data centers.
In a statement about X, Nvidia, the world's most valuable company, said it is the only platform that “runs every AI model and does so everywhere it computes.”
In response, Google said it intends to “support both its own chips and Nvidia chips.”
Nvidia chips have become an important part of the data centers powering many of the most popular artificial intelligence tools, such as ChatGPT.
In October it became first company ever valued at $5 trillion (£3.8 trillion).
In recent months, the US firm has sought to expand its presence, announcing agreement in October supplying some of its most advanced artificial intelligence (AI) chips to the South Korean government, as well as Samsung, LG and Hyundai.
Google leases access to its chips, called tensor processing units (TPUs), through Google Cloud to artificial intelligence developers.
In other words, they are not sold to external users, but are stored in the tech giant's own data centers.
But if recent reports are true—that the tech company could be in talks to sell its chips to power other data centers—that would represent a significant change.
The news sent shares of Nvidia down nearly 6% on Tuesday, while shares of Google parent Alphabet rose nearly the same percentage.
Hours after the crash, the chip giant posted on X that it still offers “more performance” and “versatility” than the types of chips Google makes.
Last year both Amazon and Microsoft announced that they also have artificial intelligence chips in development.
Dame Wendy Hall, Queen's Professor of Computer Science at the University of Southampton, told the BBC's Today program that news of a potential deal between Google and Meta was “good” for the market.
“Investment is pouring into this area,” she said.
“At this point, there is no real return on this investment except for Nvidia.”
