Amazon, Alphabet, and Microsoft Are All Racing to Design Their Own AI Chips. Here's What It Means for Nvidia.
The cloud giants are spending hundreds of billions to build AI data centers -- and a growing slice of that money is going toward chips they design themselves.
Amazon, Alphabet, and Microsoft Are All Racing to Design Their Own AI Chips. Here's What It Means for Nvidia.
Overview
Three of the largest buyers of Nvidia (NASDAQ: NVDA) chips are also three of the companies trying hardest to need fewer of them. Amazon (NASDAQ: AMZN), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Microsoft (NASDAQ: MSFT) each design their own AI processors now, and each is pushing that silicon deeper into the data centers it's building at a breakneck pace.
It's easy to read that as a problem for the company whose graphics processing units (GPUs) have been the default pick for AI work. On Friday, the market seemed to agree that the company faces some risks, with Nvidia shares falling about 6% in a broad semiconductor sell-off. But the companies building their own chips are also buying record amounts of Nvidia's, and that contradiction sits at the center of the story.
Image source: Getty Images.
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Originally published at www.fool.com.
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