Nvidia pares gains after Amazon launches newest AI chip

The problem with being the king is that everyone’s trying to get their hands on your shiny crown.

Shares of Nvidia pared gains after Amazon publicly launched its custom chip, called the Trainium3, as part of its AWS re:Invent 2025 event in Las Vegas.

The company said these chips can cut costs associated with training and using AI models by up to 50% compared to GPU-based systems offered by the likes of Nvidia and Advanced Micro Devices.

The potential for increased competition, particularly from Google, which is reportedly in talks to sell its custom TPUs codesigned with Broadcom to Meta, has been a drag on Nvidia shares as of late, as this has the potential to weigh on its market share and profitability.

Nvidia came into the week trading at a record discount to Broadcom, the custom chip specialist, based on 12-month price-to-earnings ratios.

Even as traders fret over competition, however, it’s clear that leading tech companies are building for a future in which Nvidia is still the dominant player. For instance, Amazon said that the next edition of this custom chip (Trainium4) “will support Nvidia NVLink Fusion high-speed chip interconnect technology.”

In other words, Amazon is preparing for a world in which its upcoming chips will be used in tandem with Nvidia’s offerings.