Google drops two new AI chips, handing Nvidia a second front

Alphabet rolled out the 8tx and 8i Max on Monday, both tweaked versions of the Tensor Processing Units Google has quietly built for Search, YouTube and Gemini for years. Shares climbed more than 2% in premarket trading, a bright spot after a 9% slide this year through the prior close.

The 8tx is aimed at customers who can't afford to expose the data running through their machines — government departments, banks and anyone under tough privacy rules. Google worked with chip makers at AMD to put encryption directly into the hardware, and claims up to twice the speed of the previous generation with virtually no performance hit.

The 8i Max goes the other way: two chips fused into one for extra memory and raw compute. Google flagged software coding assistants, mathematical reasoning and drug discovery as the jobs it's built to handle.

The bigger shift is how Google sells the silicon. TPU compute is now available through Google Cloud, letting outside companies run AI workloads without buying Nvidia hardware. Alphabet said TPU sales made a meaningful contribution to its September-quarter results, with Google Cloud revenue more than doubling, now at $30.71 billion.

Nvidia's own week is uglier. The stock has fallen roughly 6% amid speculation over Huang's admitted affair with his wife Lori Mills and espionage worries involving China, according to Cryptopolitan — wiping about $250 billion off its market value. Huang holds about 3.5% of the company, so the sell-off has carved billions off his personal stake.

In a statement circulated to Nvidia staff, Huang said: “There is no excuse for what I did. I am deeply sorry.” Nvidia says it has no reason to believe company secrets or US national security were compromised, and the investigation will test that rather than assume it. Trump called Huang a “good guy” while noting “you never know what's going on,” Rubio said he “just can't comment,” and China's Foreign Ministry called the allegations “groundless speculation.” Huang has given no sign he'll step down; he told Bloomberg he hopes to stay 20 more years and said daughter Madison would “have to go earn it” if she ever wanted the top job.