Nvidia shares tumble on signs Google gaining upper hand in AI

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Nvidia shares fell on Tuesday on widening concerns that Google is gaining ground in artificial intelligence, wiping nearly $250 billion off the AI ​​chip maker’s market value.

The sell-off saw Nvidia shares fall 5.3 percent, representing the company’s biggest intraday decline since April.

Nvidia’s decline rippled across the broader market, with the tech-heavy Nasdaq Composite falling 0.2 percent in morning trading.

Server maker Super Micro Computer, a major Nvidia partner, fell 3.1 percent, while software group Oracle, which has committed to spending billions of dollars on the chipmaker’s high-performance systems, lost 3.4 percent.

Shares of data center operator CoreWeave, in which Nvidia has a 6 percent stake, fell 4.7 percent, along with its AI cloud rival Nebius, which fell 3.6 percent.

Investors attributed this decline to the excitement surrounding Alphabet’s chips specializing in artificial intelligence, known as tensor processing units.

Last week, Google released Gemini 3, its latest major language model, which is considered to have surpassed OpenAI’s ChatGPT. Google’s model was trained using TPUs rather than the Nvidia chips that power the OpenAI systems.

Mike O’Rourke of Jones Trading said the launch of Gemini 3 “may be a more subtle but more significant version of disrupting DeepSeek,” referring to the Chinese artificial intelligence startup whose emergence in January led to a sharp sell-off by US technology groups including Nvidia.

“The market is taking the view that Google is the clear leader in AI,” O’Rourke added.

Charlie McElligott, a strategist at Nomura, also likened the Gemini 3 impact to the DeepSeek shock. Alphabet’s latest model has “reset” the “hierarchical AI chessboard” and pulled the market into a “new DeepSeek moment,” he said in a note to clients.

A report in The Information late Monday indicated that Google was pitching to potential clients including Meta about using TPUs in their data centers instead of Nvidia chips.

Google’s TPUs have so far only been available for customers to rent through its cloud computing service. Meta, like OpenAI, is one of Nvidia’s largest customers.

Shares of Alphabet rose 1.3 percent on Tuesday to a new record high, pushing it closer to a market value of $4 trillion for the first time.

Nvidia has now lost more than $800 billion in market value since peaking above $5 trillion less than a month ago. AMD, Nvidia’s main competitor in AI-focused chips, also fell 7.6 percent on Tuesday.