Topline
AI darling Nvidia fell in trading Tuesday and continued a string of losses that began at the start of the month, conflicting with gains made by the Nasdaq Composite, S&P 500 and Dow Jones Industrial Average after a report from The Information said Meta was considering a multibillion-dollar investment into Google artificial intelligence chips.
Nvidia shares closed down 2.6% on Tuesday.
Photo by Cesc Maymo/Getty Images
Key Facts
Nvidia shares closed down 2.6% and fell another half percent to $177.68 in after-hours trading.
The report, published Monday, said Meta was in talks with Google about using the Alphabet subsidiary’s processing units for AI within its data centers in 2027.
Google’s AI chip business for “high-frequency trading firms that run AI models in their facilities” could help the company snatch 10% of Nvidia’s annual revenue, according to The Information, which cited an unnamed person who spoke about conversations between leaders in Google’s cloud business.
Alphabet shares closed up 1.6% on Tuesday, continuing a strong month for the company’s stock, which has traded up 24.2% since the start of November.
Meanwhile, the Dow Jones climbed over 1%, the Nasdaq composite moved up 0.7% and the S&P 500 popped 0.9%, all continuing a three-day long rally.
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What Else Did The Report Say?
The report noted Nvidia CEO Jensen Huang could preempt a Meta-Google deal by striking his own arrangement with Meta, which already spends billions of dollars a year on Nvidia’s chips. Google is also catching up with Nvidia on a technical level when it comes to chips for AI inference, according to The Information. AI inference chips make decisions or recognize patterns based on data they have not yet seen, unlike chips used for AI training that use given datasets to identify patterns.
Read More: Here’s Why Nvidia Dropped Tuesday—While Most Stocks Jumped
