Nvidia has claimed it is “a generation ahead” of rivals in the artificial intelligence (AI) industry amid growing suggestions a rival may emerge to threaten to its market dominance – and multi-trillion dollar valuation.
Shares in the chip giant fell on Tuesday, following a report Meta planned to spend billions on AI chips developed by Google to power its data centres.
In a statement on X, Nvidia, the world’s most valuable company, said it was the only platform which “runs every AI model and does it everywhere computing is done”.
In response, Google said it was committed to “supporting both” its own and Nvidia’s chips.
Nvidia’s chips have become a critical part of powering the data centres behind many of the most popular AI tools, such as ChatGPT.
In October it became the first company ever to be valued at $5tn (£3.8tn).
The American firm has been looking to expand its reach further in recent months, announcing an agreement in October to supply some of its most advanced artificial intelligence (AI) chips to South Korea’s government, as well as Samsung, LG, and Hyundai.
Google rents access to its chips, called tensor processing units (TPUs), through Google Cloud to AI developers.
In other words, they are not sold externally – but kept for the tech giant’s own data centres.
But if recent reports are correct – that the tech company could be in talks to sell its chips to power other data centres – it would represent a significant change.
The news saw Nvidia shares fall nearly 6% on Tuesday, whilst those in Alphabet, Google’s parent company, rose by nearly the same percentage.
In the hours following the drop, the chip giant posted on X to state it still offered “greater performance” and “versatility” than the types of chips Google is producing.
In the past year, both Amazon and Microsoft have announced they also have AI chips in development.
Dame Wendy Hall, Regius Professor of Computer Science at the University of Southampton, told the BBC’s Today programme the news of the potential deal between Google and Meta was “healthy” for the market.
“Investment is pouring into this area,” she said.
“At the moment there is no real return on that investment except for Nvidia”.
