AMD Stock Extends Decline In Pre-Market On Meta’s Reported Interest In Google’s TPUs – Mizuho Warns Of A ‘Modest Challenge’

• Bernstein flagged concerns about AMD’s prospects if TPUs emerge as a viable alternative to GPUs for AI customers.
• The firm noted that AMD has positioned itself as the “viable second source” to Nvidia amid a scarcity of computing capacity.
• It also noted that AMD has aligned itself closely with OpenAI and, if Google’s Gemini 3 dominates ChatGPT, questioned whether investors would remain confident in AMD.

Shares of Advanced Micro Devices Inc. (AMD) were down by nearly 1% in Wednesday’s pre-market trade, extending its decline, after falling over 4% during the previous trading session.

The decline in AMD shares comes amid reports that Meta Platforms Inc. (META) is considering buying Alphabet Inc.-owned (GOOG) (GOOGL) Google’s Tensor Processing Units (TPU) for use in its data centers.

According to TheFly, analysts at Mizuho flagged that this could prove to be a “modest challenge” for Lisa Su-led AMD and Nvidia Corp. (NVDA). Both companies make graphics processing units (GPU), and Google’s TPUs could eat into their market shares.

Retail sentiment around AMD trended in the ‘bullish’ territory at the time of writing.

Bernstein Flags Concerns

Bernstein flagged concerns about AMD’s prospects if TPUs emerge as a viable alternative to GPUs for AI customers, according to a report by Investing.com. The firm noted that AMD has positioned itself as the “viable second source” to Nvidia amid a scarcity of computing capacity.

It also noted that AMD has aligned itself closely with OpenAI and, if Google’s Gemini 3 dominates ChatGPT, questioned whether investors would remain confident in AMD.

This follows a deal between the two companies in October to deploy 6 gigawatts of the chipmaker’s Instinct GPUs. AMD has also signed a deal with Oracle to supply 50,000 Instinct GPUs.

However, the firm noted that the AI market faces a supply constraint, not saturation, adding that there is enough space in the sector for both GPUs and TPUs if artificial intelligence demand continues to grow.

Meta TPU Deal

According to a Reuters report citing The Information, the talks between Meta and Alphabet-owned Google also involve renting chips from the latter. Meta is expected to begin using Google’s TPU chips in its data centers starting in 2027.

The report stated that some Google Cloud executives expect the company to help it capture up to 10% of Nvidia’s annual revenue. The AI bellwether reported $130.5 billion in revenue in 2024 and is expected to report $212.6 billion in revenue in 2025, according to Stocktwits data.

AMD stock is up 71% year-to-date and 46% over the past 12 months.

Also See: David Sacks Clarifies He Remains Opposed To AI Bailouts After Saying Reversal In Investments Would Risk Recession

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