Google and Meta reached a multi-billion dollar AI chip agreement, intensifying competition with Nvidia.

According to a negotiator, Meta has signed an agreement to lease Google's AI chips for the development of new AI models. Another source stated that this multi-year agreement is worth billions of dollars. Meta is also in talks with Google to purchase TPUs for its data centers as early as next year, but the progress of these negotiations is unclear. This agreement is a victory for Google, as it adds another well-known customer and boosts its TPU sales business, which is worth billions of dollars. At the same time, this poses a threat to NVIDIA, which dominates the AI chip market and currently provides graphics processors for Meta's AI training. In addition to partnering with Meta, Google has also signed an agreement with an unnamed large investment institution to establish a joint venture, where the institution will provide financing to rent TPUs to other customers. Google is in discussions with other investment institutions to establish more joint ventures like this one.