NVIDIA Valuation & TPU Competition Analysis: Key Insights & Risks

On November 28, 2025, a Reddit discussion debated NVIDIA’s (NVDA) valuation and competitive threats from Google’s Tensor Processing Units (TPUs). Key bullish arguments included NVDA’s ecosystem lead and cost-effective Blackwell/Rubin chips, while bearish points highlighted a high PE ratio and margin compression risks from competition [6]. Market performance reflects near-term concerns: NVDA closed at $176.51 on November30, down2.08% day-over-day and13% month-over-month, but up27.62% YTD [0]. The data center segment accounts for88.3% of FY2025 revenue, making NVDA highly exposed to TPU competition [0]. Google’s TPUs are gaining traction with cloud providers, but NVDA’s partnerships (e.g., Google Cloud offering Blackwell GPUs) mitigate immediate risk [5]. Analyst consensus remains bullish:73.4% rate NVDA as Buy with a $250 target (+41.6% upside) [0].

1. Dual-track adoption
   : Cloud providers like Google use both NVDA GPUs and TPUs, balancing flexibility and cost efficiency [5].
2. Ecosystem moat
   : NVIDIA’s CUDA platform (5M+ developers) is a significant barrier to competitors like AMD’s ROCm [0][4].
3. Revenue concentration
   : Over-reliance on data center revenue (88.3%) amplifies competition risk from TPUs [0].
4. Valuation disconnect
   : Despite a high PE ratio (~43.69x), analyst optimism persists due to long-term growth prospects [0].

• Competition
  : Google’s TPUs and Meta’s potential2027 chip switch could erode market share [1][5].
• Supply chain
  : Dependence on TSMC (Taiwan) exposes NVDA to geopolitical tensions [2].
• Valuation
  : High PE ratio leaves NVDA vulnerable to earnings misses [0].

• Blackwell/Rubin adoption
  : Cost-effective chips may drive market share retention if performance claims are validated.
• Ecosystem strength
  : CUDA’s dominance could maintain customer loyalty despite competition [0][4].

• Current price: $176.51 [0]
• PE ratio: ~43.69x [0]
• Analyst consensus target: $250 (+41.6% upside) [0]
• Data center revenue share: 88.3% [0]
• Net profit margin:53.01% (Q32025) [0]