Nvidia typically sets the standard that other companies must meet. This is not usually reversed. However, on Tuesday, the chip manufacturer, valued at $4 trillion, engaged in an unusual action: It utilized X to issue a public defense following a report indicating that one of its primary clients, Meta, is contemplating a move of some of its artificial intelligence infrastructure to Google's proprietary processors, known as TPUs.
TL;DR
- Nvidia publicly defended its market position on X after a report suggested Meta might use Google's TPUs.
- Nvidia's stock dropped over 2.5% following the report, while Alphabet's shares rose on Gemini 3 praise.
- Google is promoting its TPUs to clients like Meta, intensifying competition with Nvidia's GPUs.
- Nvidia emphasized its GPUs' performance, versatility, and industry-leading Blackwell architecture.
This defensive action followed a drop of over 2.5% in Nvidia's stock price upon hearing the announcement. Near the market's close, shares of Alphabet experienced a third consecutive day of gains, boosted by its newly released Gemini 3 model, which garnered praise from prominent technology figures like SalesforceCEO Marc Benioff.
The trigger was a report from The Information alleging that Google has been promoting its AI processors, referred to as TPUs, to external corporations such as Meta and various significant financial entities. While Google currently leases these processors to clients via its cloud platform, broadening TPU adoption within customers' private data facilities would signify a substantial intensification of its competition with Nvidia.
That was enough to rattle Wall Street, and also Nvidia itself.
“We’re delighted by Google’s success—they’ve made great advances in AI, and we continue to supply to Google,” Nvidia wrote in a post on X. “Nvidia is a generation ahead of the industry—it’s the only platform that runs every AI model and does it everywhere computing is done.”
It's quite evident what's being implied. While Google's TPUs may be gaining momentum, Nvidia aims to assure its investors and clientele that it remains an unassailable force.
Brian Kersmanc, a pessimistic portfolio manager at GQG Partners, had foreseen this development. In a conversation with Coins2Day toward the end of last week, he cautioned that the sector was starting to view Google’s processors as a practical substitute.
“Something I think was very understated in the media, which is fascinating, but Alphabet, Google’s Gemini 3 model, they said that they use their own TPUs to train that model,” Kersmanc said. “So the Nvidia argument is that they’re on all platforms, while arguably the most successful AI company now, which is [Google], didn’t even use GPUs to train their latest model.”
Why Google suddenly matters again
For nearly ten years, Google's AI processors were viewed as an ingenious internal utility: swift, effective, and closely linked to Google's proprietary frameworks, yet not a genuine challenge to Nvidia's versatile GPUs, which dominate over 90% of the AI accelerator sector.
A portion of this stems from the design. TPUs are ASICs, meaning they are specialized chips fine-tuned for a limited range of tasks. Nvidia, in its X post, took care to emphasize the distinction.
“Nvidia offers greater performance, versatility, and fungibility than ASICs,” the company said, positioning its GPUs as the universal option that can train and run any model across cloud, on-premise, and edge environments. Nvidia also pointed to its latest Blackwell architecture, which it insists remains a generation ahead of the field.
However, the preceding month has altered the atmosphere. Google's Gemini 3—developed exclusively using TPUs—has attracted strong reviews and is being presented by some as a genuine competitor to OpenAI's leading models. Furthermore, the notion that Meta might implement TPUs directly within its data centers—lessening dependence on Nvidia GPUs for certain components of its operations—indicates a possible transition that shareholders have long wondered about but had not yet witnessed.
Meanwhile, the Burry battle escalates
Google wasn't the only one adopting a defensive stance. In private, Nvidia has also been discreetly engaged in a separate conflict: an escalating dispute with Michael Burry, the financier renowned for foreseeing the 2008 housing market downturn and a key figure in Michael Lewis's seminal work The Big Short.
Following Burry's issuance of several cautions likening the present AI surge to the dotcom and telecom busts—contending that Nvidia is the Cisco of this cycle, implying it similarly furnishes the infrastructure for the expansion but could potentially suffer intensive corrections—the semiconductor manufacturer distributed a seven-page document to financial analysts on Wall Street directly refuting his assertions. Burry himself disclosed the document on Substack.
Burry has accused the company of excessive stock-based compensation, inflated depreciation schedules that make data center build-outs appear more profitable, and enabling “circular financing” in the AI startup ecosystem. Nvidia, in its memo, pushed back line by line.
“Nvidia does not resemble historical accounting frauds because Nvidia’s underlying business is economically sound, our reporting is complete and transparent, and we care about our reputation for integrity,” it said in the memo, on which Barron’s was first to report.