Why Alphabet and Amazon Will Always Need Nvidia Alex Sirois Wed, November 11, 2026 at 7:15 AM EST 4 min read AMZN +0.68% GOOG +1.05% NVDA +3.28% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Alphabet and Amazon push their own TPUs and Trainium chips, yet NVIDIA still supplies both, with AWS adding 2 million NVIDIA GPUs.
Jensen Huang calls rival chips "inference-specific chips for one cloud or one service," while CUDA keeps NVIDIA essential for training frontier models.
Alphabet burned cash with negative free cash flow of $9 billion and issued $29 billion in new notes, signaling spending strain.
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All three — NVIDIA (NASDAQ:NVDA), Alphabet (NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN) — have reported earnings. Taken together, the three reports describe one connected business. Google sells its own TPUs, and Amazon is expanding Trainium. Both still buy NVIDIA systems at enormous scale. NVIDIA shares fell 18.29% over the past week, so that dependence is worth testing now.
Google Cloud revenue rose 103% to $30.71 billion, which makes it Alphabet's main growth engine. Sundar Pichai pointed to "strong demand for our TPU systems across a wide range of customers." NVIDIA also lists Google Cloud among the sites where Vera Rubin is in full production. Google sells its own chips while running NVIDIA's in its data centers.
AWS revenue rose 39% to $45.98 billion. Most of Bedrock runs on Trainium, and custom-silicon customers saved more than $2 billion in Q3 alone, according to Andy Jassy. That gives Amazon real leverage. Even so, AWS will deploy an additional 2 million GPUs from NVIDIA through the second quarter of NVIDIA's fiscal 2029. Jassy noted that all advanced chips come from one foundry and "everybody gets an allocation," which limits how fast Trainium can scale.
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Jensen Huang described rival chips narrowly: "Many of these XPUs are inference-specific chips for one cloud or one service." NVIDIA argues that one platform can serve every cloud and every phase of AI work. Training frontier models takes the densest compute and fastest interconnects available, and most of the machine learning world writes its code for CUDA. Cloud providers have to offer the hardware developers ask for.
For Amazon, Trainium is mainly about protecting margins, and AWS posted a 38.7% operating margin. Alphabet's spending is harder to absorb. Free cash flow came in at negative $9.07 billion, and the company issued $28.7 billion in new notes. That looks like strain to me.
NVIDIA forecast Q3 revenue to $108.0 billion plus or minus 2%, and it expects Vera Rubin to make up about 20% of data center revenue. Huang described his fiscal 2028 growth outlook of about 70% as limited by supply. The key question is whether Amazon's external Trainium sales, set to start in late 2027, and Google's TPU sales begin pulling workloads away from CUDA.
NVIDIA is the supplier that both of these companies keep paying. After a 26.34% drop over the past month, NVIDIA trades near 34x earnings. Amazon sits near 38x and Alphabet near 13x. Alphabet has the lowest earnings multiple of the three. Its $8.70 billion loss on equity securities still makes me cautious. Amazon's valuation leans on Jassy's forecast of AWS growth above 40% in both 2027 and 2028.
I would change my view if external Trainium sales gain real traction. Until that happens, Alphabet and Amazon will keep putting NVIDIA hardware in their data centers.
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