Alphabet’s AI comeback spells upside for the stock
Acknowledging the problem is the first step towards a solution — and for Alphabet, controversies like producing a Black George Washington and comparisons to Hitler were likely the problems that sent CEO Sundar Pichai on a mission to fix Gemini, its OpenAI competitor. Weeks after a rocky rollout, investors are catching a glimpse of its fixes — driving shares up by 20% since.
- This week, Google unveiled updates to its AI suite at its annual cloud computing conference — including a promising turnaround in Gemini’s generative AI capabilities.
- One of the biggest strides is grounding, allowing Gemini users to connect the AI’s responses to Google search sources, ensuring “greater accuracy and freshness,” says Google Cloud CEO Thomas Kurian.
Comeback quarter: With the tech giant sitting shy of a $2T valuation, analysts are mixed on what comes next. Bank of America’s Justin Post sees promise, adding that the credible demos should be a “positive driver for the stock.” But not everybody is sure the stock can catch up with AI peers — including Baron Opportunity Fund’s Michael Lippert, who warns that AI could disrupt Google’s core revenue source… its search business.
Read: Explore Alphabet’s AI evolution and the uproar over the Gemini model
