By Adam Clark
Nvidia was edging down early on Thursday. The chip maker just got another reminder that Broadcom remains hot on its heels as more details were unveiled about the custom chip designer's work with Meta Platforms.
Nvidia shares were down 0.6% at $184.98 in premarket trading. The stock is essentially flat for the year so far.
One of the reasons Nvidia has struggled to break out of its range-bound trading for months is concern that its largest customers will increasingly turn to custom AI chips, developed with Broadcom or other designers. It's not a trend that looks like changing -- social-media company Meta on Wednesday announced four new generations of its in-house AI processors.
Meta introduced its MTIA 300, 400, 450 and 500 chips, all for release either this year or in 2027. It noted the hardware was developed "in close partnership with Broadcom," which had already disclosed it expects Meta to install "multiple gigawatts" worth of its chips in the next few years.
Meta and Broadcom's jointly developed application-specific integrated circuits, or ASICs, are unlikely to be as powerful overall as Nvidia's graphics-processing units but could be more cost effective for running the company's ranking and recommendation systems.
That doesn't mean Meta isn't about to stop spending on Nvidia chips -- the two companies just affirmed last month they were expanding their collaboration in a chips-and-networking deal likely to be worth tens of billions of dollars last month.
"While Meta showcases solid generation-over-generation improvements across its four chips, these ASICs still broadly lag Nvidia products," wrote William Blair analyst Sebastien Naji in a research note. "Comparing the two middle-generation chips (400/450), which are expected to launch at a similar time frame as Nvidia's Rubin, we note that Nvidia maintains a significant performance advantage."
Specifically, Naji noted that Nvidia's next-generation Rubin hardware looks set to offer roughly four times the compute throughput of Meta's MTIA 400 and twice the performance of MTIA 450. However, where Meta's chips are competitive is in packing the hardware with high-bandwidth memory, required for processing huge amounts of data.
"By allocating a larger share of the silicon budget to memory bandwidth rather than compute, Meta can optimize the chip for the specific workloads running across its social and messaging platforms," Naji wrote.
That should be good news for memory-chip company Micron Technology, which has more than quadrupled in the past year as demand for high-bandwidth memory has boosted prices across the sector.
Naji also reckons there could be positives from Meta's AI infrastructure spending for Credo Technology Group Holding, which makes copper-based cable used to attach AI servers to networking switches, Monolithic Power Systems -- a supplier of power-management chips -- and networking company Arista Networks.
Micron and Broadcom shares were both down 0.6% in premarket trading.
Write to Adam Clark at adam.clark@barrons.com
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(END) Dow Jones Newswires
March 12, 2026 08:44 ET (12:44 GMT)
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