I don't know why you'd be confused by the valuations, they're just 2 different businesses. Google is an ad sales business with an extremely strong revenue drive

I don't know why you'd be confused by the valuations, they're just 2 different businesses. Google is an ad sales business with an extremely strong revenue driver (youtube and Search) so it churns out money but it's pretty well understood revenue stream and is facing some possible disruption. Nvidia is a chip sales business and whether through luck or through skill (or both) they've essentially ended up as the monopoly provider of the worlds best chips. It's not unreasonable to expect Nvidia can squeeze a tonne of cash out of their customers for the next few years in an undisruptable way. So it's easy to understand the valuations. On the GPU side - One way to look at it is lets just ignore whether you're selling chips. Let's just look at where compute is done - because Google let's you rent time on the TPUs so if they're really great people will just choose to rent time on them. How much time is being rented on TPUs in the cloud vs. Nvidia GPUs? Google's TPUs are not a market leader, they're probably not even significant market share. Pretend Google decided to sell TPUs tomorrow - are many people who weren't choosing to rent TPUs going to decide to buy them? No. There's an element of interoperability and supply chain etc. etc. but I think the core of it is a full ML product the TPU isn't anywhere close to the Nvidia GPUs.