Meta Platforms (NASDAQ:META) is exploring whether to use Google-designed chips in its data centers, a shift that could significantly influence competition in the AI hardware market, according to a report from The Information.
Meta is reportedly considering deploying Google’s tensor processing units (TPUs) in its facilities beginning in 2027. The company may also start renting TPUs through Google Cloud as soon as next year.
Following this news, shares of NVIDIA (NASDAQ:NVDA) dropped 6.8%, while Advanced Micro Devices (NASDAQ:AMD) fell as much as 9% in U.S. trading.
Bernstein analyst Stacy Rasgon said the development is “incrementally negative” for AMD, noting that the company has positioned itself as the primary alternative to Nvidia, particularly through its alignment with OpenAI.
Meanwhile, Alphabet (NASDAQ:GOOGL), Google’s parent company, saw its stock rise 2.7%, moving it closer to its $4 trillion valuation target.
Google first introduced its TPU lineup in 2018 for internal cloud operations and has since launched newer generations optimized for artificial intelligence workloads. These chips are designed to handle the intense computational needs of advanced AI models, giving Google an efficiency advantage over competitors.
A partnership with Meta would represent a major endorsement of Google’s chip technology and signal a rare shift away from exclusive reliance on Nvidia solutions among top AI platforms.
Broadcom (NASDAQ:AVGO), which works closely with Google on custom ASIC designs, also benefited from the report. Its shares jumped 11.1%, supported by expectations of increased demand within the expanding AI infrastructure market. Rasgon noted that Broadcom has also been collaborating with Meta on its own ASIC projects.
