Alphabet’s Strategic Gambit: Challenging Nvidia’s AI Dominance

While U.S. markets observed a Thanksgiving closure, significant developments appear to be unfolding within Alphabet. Industry reports suggest a groundbreaking collaboration with rival Meta Platforms that could fundamentally reshape the competitive landscape of the artificial intelligence sector. This potential alliance raises crucial questions about whether the technology giant is launching a direct assault on Nvidia's hardware supremacy or if this merely represents another speculative rumor in an overheated market.

The speculation surrounding this new revenue stream has already provided upward momentum for Alphabet's stock this week. Trading at approximately €277 per share, the equity is approaching its recently established all-time peak. A substantial twelve-month advance of around 73 percent clearly indicates that investor concerns about an "AI bubble" affecting Alphabet have diminished, with market participants now rewarding the company's concrete progress in monetizing its cloud division.

From a fundamental perspective, the valuation appears to retain additional upside potential. While the broader technology sector remains richly valued, analysts continue to view Alphabet as comparatively attractive. The company's aggressive expansion initiatives further strengthen its position, including a focused development of a new $15 billion AI hub in India designed to consolidate its global infrastructure.

Should investors sell immediately? Or is it worth buying Alphabet?

The Semiconductor Power Shift

At the heart of these developments lies a potentially transformative scenario: Meta is reportedly engaged in active negotiations to utilize Google's proprietary AI chips, known as Tensor Processing Units (TPUs). Should the Facebook parent company commit to large-scale deployment of Google hardware for its data centers beginning in 2027, this would represent a substantial challenge to Nvidia's current market dominance.

For Alphabet, this development validates a strategic vision pursued over many years. The company has dedicated a full decade to developing proprietary silicon solutions to achieve greater independence. Now, this internally developed hardware could emerge as a commercially viable product for other technology leaders. Analysis from Morgan Stanley strategists indicates that external sales of 500,000 TPU units could immediately boost Alphabet's cloud revenue by 11 percent.

Market Outlook and Technical Positioning

As U.S. markets prepare to open for abbreviated Black Friday trading, observers will monitor whether bullish sentiment can maintain its current trajectory. From a technical analysis perspective, the stock has entered "blue sky" territory—trading above all historical resistance levels. The critical question remains whether investors will utilize record pricing to secure profits or if the Meta collaboration speculation will ultimately propel the market capitalization beyond the psychologically significant $4 trillion threshold.