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NVDA Tumbles as Google-Meta TPU Deal Sparks Competition Fears

Nvidia (NVDA) slid on November 25 after a report revealed Meta is in talks to use Google's custom AI chips, intensifying fears about Nvidia's dominance. Reddit users questioned the narrative shift, while broader market rotation away from AI tech added pressure.

  1. NVDA dropped after The Information reported Meta is considering Google's TPUs for data centers starting in 2027, challenging Nvidia's AI chip dominance.

  2. Despite Nvidia's strong earnings and guidance, the stock fell amid a broader rotation out of AI names into small caps and healthcare, according to Benzinga.

  3. Reddit users on r/wallstreetbets questioned the coordinated negative headlines, with one user noting the Google TPU ecosystem is "not even close to replacing Nvidia at scale today."

Nvidia Corp

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$NVDA shares took a hit on Tuesday as a report that Meta Platforms is exploring Google's custom TPUs reignited concerns about Nvidia's stranglehold on the AI chip market. The stock fell roughly 3-4% in premarket trading, according to r/stockmarket posts, and remained under pressure through the session.

The catalyst was a report from The Information stating that Google is pitching its tensor processing units (TPUs) for deployment in customers' own data centers, with Meta discussing a multibillion-dollar deal starting in 2027. The news sent Alphabet shares higher while

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$NVDA sold off. On r/wallstreetbets, one user expressed frustration: "Nvidia just reported one of the strongest earnings... and out of nowhere the news cycle flips. Suddenly every headline is about Google’s TPUs."

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Despite the selloff, many Reddit users remained skeptical of the threat. On r/stocks, a user pointed out that TSMC benefits regardless of whether it makes Google TPUs or Nvidia GPUs, and that Meta's diversification is a natural hedge rather than a wholesale abandonment of Nvidia. Another user on r/wallstreetbets questioned: "Are TPUs being overhyped or are they a threat to their business? I never would have expected a $4T company to publicly react like this over sentiment."

Nvidia's broader market context also contributed. Benzinga noted a rotation out of AI-related tech into small caps and pharma, with Nvidia and AMD leading the decline. Jim Cramer weighed in, calling Broadcom the "most likely winner" in a potential Google-Meta deal, citing CEO Hock Tan's board seat at Meta and Broadcom's growing AI hardware capabilities. Meanwhile, analyst price targets remain optimistic—The Motley Fool highlighted a consensus 12-month target of around $257 for

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$NVDA.

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