Author: admin

By Jules Rimmer

Alphabet could be selling 1 million AI chips by 2027, analysts say

Alphabet’s AI efforts – from Gemini 3 to custom-built tensor processing units – have been winning praise.

A report that Meta is in discussions to buy billions of dollars’ worth of Alphabet’s highly specialized AI microchips has led to speculation that the Google parent could encroach on Nvidia’s dominant market share.

Morgan Stanley on Wednesday became the latest to weigh in on what has become the hottest topic on Wall Street. It’s “not unreasonable” to suggest that by 2027, Alphabet (GOOG) (GOOGL) could be shipping 500,000 to 1,000,000 of its TPUs, or custom chips known as tensor-processing units, analysts led by Brian Nowak said in a note to clients.

The number is notable because Alphabet designed the chips for internal use, but its success with them – plus the global crunch for more computing power – has sparked external interest.

In the market for artificial-intelligence chips, Nvidia (NVDA) has a roughly 90% share, according to third-party industry data. The company’s dominance helped it achieve a market capitalization of $5 trillion less than a month ago, though the stock’s recent pullback has brought Nvidia’s market value down to $4.3 trillion.

A recent report from the Information said that Meta (META) could start using Alphabet’s highly specialized chips, cutting Nvidia’s market share. That could spark boosts to Alphabet earnings forecasts, which have driven Alphabet’s stock price up in anticipation and lifted its market capitalization to the brink of $4 trillion.

Shares of Alphabet slipped 1% on Wednesday.

Morgan Stanley’s calculations showed an 11% uplift to Alphabet’s cloud revenues and a 3% uplift to earnings per share for every 500,000 TPUs that the company sells externally. Moreover, faster cloud growth and expansion into this market could allow Alphabet shares to command a higher price-earnings (P/E) multiple.

In a Tuesday post on X from Nvidia, the company’s newsroom wrote: “We are delighted by Google’s success,” while pointing out Nvidia is “a generation ahead of the industry – it’s the only platform that runs every AI model and does it everywhere computing is done.”

Nvidia recently commanded the overwhelming majority of the market for graphics processing units.

Nowak said that Alphabet has invested many resources into developing its TPUs to make them compatible with more systems, including through software enhancements.

These latest developments could help Alphabet’s stock sustain its recent AI-fueled momentum that extends beyond chip excitement. The company’s Gemini 3 launch earlier this month was generally regarded as hugely successful, positioning Alphabet’s large-language model as a serious competitive threat to OpenAI’s ChatGPT.

Alphabet’s stock has risen 56% over the past three months, bringing its year-to-date gains to 71%. Nvidia’s stock is off 2% over a three-month span but ahead 32% in 2025.

-Jules Rimmer

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

  (END) Dow Jones Newswires

  11-26-25 1758ET
Copyright (c) 2025 Dow Jones & Company, Inc.

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

US food company Campbell’s has dismissed an executive who was recorded criticising its food as made for “poor people” and disparaging its Indian employees.

Martin Bally was a vice-president in Campbell’s information technology department. An audio recording of his alleged comments was released by another former employee who claims Campbell’s fired him in retaliation for speaking up about Bally.

Campbell’s, known for its canned soups, made “highly processed food” for “poor people”, Bally told former employee Robert Garza, according to the lawsuit Garza filed in Michigan last week. Bally also claimed that Indian workers at Campbell’s were “idiots”, the suit alleged.

Garza said he had met Bally about a year ago to discuss his salary. There, Garza heard “several racist comments that shocked” him, the lawsuit said. Soon after reporting the comments to his manager, Garza was terminated.

Bally, whose LinkedIn profile described him as vice-president as well as chief information security officer at Campbell’s, could not immediately be reached for comment.

Campbell’s said it first learned of the litigation and heard segments of the audio recording last Thursday. Campbell’s believes that the voice on the recording is Bally’s.

“The comments were vulgar, offensive and false, and we apologise for the hurt they have caused. This behaviour does not reflect our values and the culture of our company, and we will not tolerate that kind of language under any circumstances,” Campbell’s said, adding that Bally left the company on Tuesday.

Campbell’s, established in 1869 in Camden, New Jersey, changed its name from Campbell Soup in 2024 after it diversified into snacks and other foods. Its revenue totalled $10.3bn in the latest fiscal year.

Like other packaged food companies, Campbell’s profits and sales volumes have declined as consumers pull back in the face of higher food prices. It is also contending with renewed scrutiny of food ingredients as the so-called Make America Healthy Again movement is embraced by the Trump administration.

In audio aired by a local Michigan television station, Bally is recorded saying he does not want to eat Campbell’s “bioengineered meat” or “a piece of chicken that came from a 3D printer”.

“Campbell’s does not use 3D-printed chicken, lab-grown chicken, or any form of artificial or bioengineered meat in our soups,” the company said.