Episode summary
Amazon Rushes Out Latest AI Chip to Take on Nvidia, Google | Bloomberg Intelligence
Bloomberg Intelligence
· · Hosts: Paul Sweeney, Alexandra Semenova · Guests: Mandeep Singh, Poonam Goyal, Geetha Ranganathan, Brian Egger
Summary
Amazon is racing to improve its in-house AI chip strategy so it can rely less on Nvidia and better compete with Google’s TPU effort. The guest said Amazon, as the largest cloud provider with almost 50% share, is trying to copy Google’s playbook by using its own chips, but Google remains ahead. The bigger theme for 2026 is shifting from the earlier GPU scramble to capex efficiency, with hyperscalers judged on how much AI output they can generate from spending rather than on chip access alone.
The guest also argued that Apple is lagging in AI because it lacks its own models and has been vague about partnerships that would make AI work natively on its operating system. That, he said, may not hit hardware sales immediately, but could matter two years out if Apple still lacks a credible AI strategy.
On the consumer side, Cyber Monday sales were slightly better than expected at $14.25 billion, but retailers broadly held discounts near last year’s levels. The guest said that should help margins in the holiday quarter, while next year’s pricing power will depend on how tariffs flow through inventory and whether courts eventually strike them down.
Key takeaways
- The guest said Amazon is trying to catch up to Google and reduce dependence on Nvidia by building its own AI chips.
- Capex efficiency, not just GPU access, is likely to be the key metric for AI winners in 2026, according to the guest.
- The guest said Apple’s lack of an AI model strategy could start to affect hardware sales two years from now.
- Cyber Monday sales reached $14.25 billion, but most retailers kept discounts close to last year, supporting holiday margins.
- The guest said tariffs may create more pricing pressure in 2026 even if consumers have not felt much impact yet.
Notable quotes
“Amazon we know is the largest cloud provider with uh almost 50% share and uh when it comes to the GPUs uh everyone so far except for uh Google has relied on Nvidia”
“what Amazon is doing is really uh copying that uh Google playbook where they want to use their own chips”
“capex efficiency will be a much bigger focus in 2026 than it was in the past two years”
“if Apple doesn't have a good AI strategy, a good model that works natively on the operating system, I think you will start to see an impact on the hardware sales”
“sales were 14.25 billion. That's just slightly ahead of the 14.2 billion estimated. So a 7.1% gain”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m.
Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. A lot of news in the tech space.
I guess it's just every day we have a lot of news in the tech space. One that jumped out at me is Amazon rushes out latest AI chip to take on Nvidia and Google. Well, that gets my attention.
Let me check in with somebody who might know a thing or two about this stuff. Mandep Singh, senior tech industry analyst, Bloomberg Intelligence. He's out there in San Diego.
I don't know what's going on in San Diego. I didn't get the invite, but Mandep's out there doing the Zoom thing. Mandep, um, Amazon chips, where do they stack up relative to say an Nvidia or Google?
I mean look, Amazon we know is the largest cloud provider with uh almost 50% share and uh when it comes to the GPUs uh everyone so far except for uh Google has relied on Nvidia you know for training and uh what Amazon is doing is really uh copying that uh Google playbook where they want to use their own chips. It's just that they haven't had that kind of success that Google has had with TPUs and they're trying to speed things up because in the end all these hyperscalers don't want to spend you know 20 to 25% of their capex on uh procuring Nvidia's chips and uh that is what the endgame is. I think Google so far is ahead in that uh but clearly Amazon is trying to catch up when it comes to their own chips efforts.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai chip competition
- cloud infrastructure
- cyber monday retail margins
- media m&a bids
- nyc casino licenses
Companies and tickers mentioned
- AMZN
- NVDA
- GOOGL
- GOOG
- WMT
- TGT
- M
- BBY
- DKS
- KSS
- NKE
- W
- NFLX
- BALY
- Amazon
- Nvidia
- Walmart
- Target
- Macy's
- Best Buy
- Dick's Sporting Goods
- Amazon.com
- Kohl's
- The Gap
- Nike
- Wayfair
- Warner Bros. Discovery
- Netflix
- Bally's
- Hard Rock
- Resorts World
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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