Google has just added a new twist to the rapidly changing AI race. And its biggest competitors are taking notice.
In a Nov. 25 post on X, Nvidia said, “We’re pleased with Google’s success. Google is making great strides in AI, and we continue to supply them with our products,” before adding, “NVIDIA offers superior performance, versatility, and substitutability over ASICs (application-specific integrated circuits) like those made by Google.”
OpenAI CEO Sam Altman also wrote about the X: “Congratulations to Google on Gemini 3! What a great model!”
The post comes days after there was a lot of buzz about Google’s Gemini 3 model and the Google chips that power it. Salesforce CEO Marc Benioff wrote to X that he won’t return to ChatGPT after trying Google’s new model. “The leap forward is insane. Reasoning, speed, images, video… everything is clearer and faster. It feels like the world has changed again,” he wrote.
According to The Information, Meta is said to be in talks with Google to purchase Tensor chips, after Anthropic announced plans in October to significantly expand its own use of Google’s technology.
Google’s stock rose nearly 8% last week, while Nvidia’s stock fell just over 2%.
What’s at stake is more than just bragging rights or a few sales contracts. As the tech industry claims AI will reshape the world, including the investment portfolios of everyone from billionaires to 401k retirees, which companies and visions come out on top could impact nearly every American.
At face value, Nvidia’s post says the company isn’t worried about Google encroaching on its territory. There’s a good reason for that. Google’s chips are fundamentally different from Nvidia’s products. That is, they are not equivalent replacements.
But it’s telling that OpenAI and Nvidia felt the need to acknowledge Google.
“I would say they are in the lead right now until someone comes up with the next model,” Angelo Gino, CFRA’s senior vice president and head of technology, told CNN.
Google and Meta did not respond to requests for comment. Nvidia declined to comment.
Google is by no means an AI underdog. Along with ChatGPT, Gemini is one of the most popular AI chatbots in the world, and Google is one of the largest cloud providers known as “hyperscalers” (a term used to describe a small number of tech giants that rent out cloud-based computing resources to other companies on a large scale). Google services like search and translation have been using AI since the early 2000s.
Still, Google was almost universally cornered in 2022 when OpenAI’s ChatGPT arrived. According to the New York Times, Google executives reportedly issued a “code red” in December 2022 after ChatGPT seemed to become an overnight success. ChatGPT currently has at least 800 million monthly active users, according to developer OpenAI, while Google’s Gemini app has 650 million monthly active users.
However, Gemini 3, which debuted on November 18th, currently sits at the top of benchmark leaderboards for tasks such as text generation, image editing, image processing, and text-to-image conversion, outperforming rivals such as ChatGPT, xAI’s Grok, and Anthropic’s Claude in these categories.
Google said more than 1 million users tried Gemini 3 in the first 24 hours, both through the company’s AI coding program and tools that allow users to connect digital services to other apps.
But Ben Ballinger, global head of technology research at investment firm Quilter Cheviot, said people tend to use different AI models for different purposes. For example, xAI and Perplexity’s models outrank Gemini 3’s search performance in benchmark tests.
“It doesn’t necessarily mean that[Google’s parent company]Alphabet is going to be the be-all and end-all when it comes to AI,” Zino said. “They’re just another part of this ever-expanding AI ecosystem.”
Google started making Tensor chips long before the recent AI boom. But NVIDIA still has the lead in AI chips, with the company reporting a 62% year-over-year increase in revenue and a 65% year-over-year profit increase in the October quarter.
The main reason for this is that Nvidia’s chips are more powerful and more widely available. Nvidia and its main rival, AMD, specialize in chips known as graphics processing units (GPUs) that can quickly perform vast amounts of complex calculations.
Google’s Tensor chips are ASICs, or chips custom-made for a specific purpose.
Both GPUs and Google’s chips can be used to train and run AI models, but ASICs are typically designed for “narrower workloads” than GPUs are designed for, Jacob Feldgois, a senior data research analyst at Georgetown’s Center for Security and Emerging Technologies, told CNN in an email.
Beyond the types of chips themselves, Nvidia offers a complete technology package for use in data centers, including not only GPUs but other critical components such as network chips.
It also provides a software platform that allows developers to tweak their code so their apps can better utilize Nvidia’s chips. This is a key selling point for gaining long-term customers. Google is also an Nvidia customer.
“If you look at the size of Nvidia’s product, no one can really touch it,” said Ted Mortenson, sector strategist at Baird’s Technology Desk.
Chips like Google aren’t going to replace Nvidia anytime soon. However, increasing adoption of ASICs and increased competition from AMD may suggest that companies are looking to reduce their dependence on Nvidia.
Google is also not the only competitor for AI chips, Quilter Cheviot’s Barringer said, and he doubts Google will be able to achieve Nvidia’s dominance.
“I think it’s part of the balance,” he said.
