Meta is in discussion with search giant Google to invest in the company's Tensor AI chip to use in Meta's AI data centres from as early as 2027. This discussion also involves Meta renting chips from Google Cloud by next year. It is going to be a part of Google's broader initiative to get customers to adopt its tensor processing units (TPUs) used for AI computation, as per a Reuters report.
This move will create a serious rivalry between the Alphabet-owned company and the chip giant Nvidia.
Google eyeing Nvidia’s revenue share
Currently, Google uses the tensor processing units in its own servers powering its Gemini 3 models, while the market is dominated by Nvidia's Blackwell, a gold standard in the market. According to the Reuters report, some Google Cloud executives have suggested the strategy could help it capture as much as 10% of Nvidia's annual revenue, a slice worth billions of dollars, according to the report.
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The company already supplies about 1 million TPUs to Anthropic, the developer of the AI model Claude. Jay Goldberg, an analyst at Seaport, has stated, “A lot of people were already thinking about it (TPUs), and a lot more people are probably thinking about it now,” as reported by the Hindustan Times.
Google's in-house Tensor chip has been powering its Pixel devices and has proved beneficial for the search giant due to its flexibility. Initially designed in 2018, the chip was built for internal usage, and later the company has pushed more updates, making it capable of handling AI workloads.
Nvidia still remains as one of the prominent players and market leader in the semiconductor business. The company reported $760 million in revenue generated in the third quarter, 56% up from the previous quarter. However, the news of the deal has given a rise to Google's stock price, putting it on track to a historic 4 trillion valuation.
