Google's try and re-establish itself on the forefront of technological research and artificial intelligence this month has pushed the corporate's shares to a record high while calming criticism that the corporate has fallen behind competitors.
During December, the Big Tech company impressed investors with a sophisticated version of its AI models and applications called Gemini 2.0, which beat the competition in benchmark tests.
In a flurry of coordinated releases, the corporate also unveiled a brand new generation of its custom AI accelerator chip – a tensor processing unit (TPU) called Trillium – geared toward difficult Nvidia's near-monopoly out there.
Google has also added the flexibility to act on behalf of users and create complex research reports – Project Mariner – and answer real-time queries via text, video and audio – Project Astra – including through smart glasses. And it began Video and image generation models called Veo 2 and Imagen 3.
“The last month has modified the state of AI, and the pace has increased dramatically within the last week alone,” said Ethan Mollick, a professor at Wharton Business School and writer of a book in regards to the technology, describing Google’s releases specifically Veo 2, as “amazing”.
“This is just not regular progress – we’re watching AI make uneven leaps, outpacing our ability to simply estimate its impact,” Mollick added.
Additionally, Google confirmed last week that it had made a breakthrough in quantum computing with a chip called Willow. It can keep “qubits” stable for longer, reducing errors and allowing them to perform useful calculations.
This is what the corporate claims It can complete tasks in 5 minutes that might take traditional supercomputers 10 septillion years to finish, however the elusive technology continues to be years away from industrial application.
In further recognition of his research leadership, Sir Demis Hassabis, founding father of Google's AI research lab DeepMind, and his colleague John Jumper shared the Nobel Prize in Chemistry in October for predicting the structure of each known protein using the AI software AlphaFold.
The demonstration of technological advances – together with three straight quarters of double-digit profit growth – have helped revive parent company Alphabet's stock price.
The stock is up 38 percent this yr and briefly hit a record high of $199.91 this week, giving it a market capitalization of $2.3 trillion. Still, there continues to be a $1 trillion gap to shut with Microsoft.
Since releasing ChatGPT in late 2022, Google appeared to squander its early advantage in AI after advancing the underlying research, particularly when its arch-rival Microsoft partnered with OpenAI. It took a yr for Google to release its own comparable version, Gemini.
“Alphabet has been under the microscope for the reason that release of ChatGPT,” said Tiffany Hsia, U.S. equity portfolio manager at AllianceBernstein, a shareholder in the corporate. “Gemini 2.0 and the quantum chip give investors recent confidence that they’re one in all the leading technology corporations.”
In an indication of growing confidence, CEO Sundar Pichai – who has faced the harshest criticism in his nine-year tenure over slow AI adoption within the spring – challenged his Microsoft counterpart, Satya Nadella.
“I would love to do a side-by-side comparison of Microsoft's own models and our models any day, any time,” Pichai said throughout the DealBook Summit earlier this month. With a smile, he added that “in addition they use other people’s models.”
As the corporate demonstrates its technological prowess, it must work out how you can integrate these innovations into its consumer and industrial applications without stifling the creativity of its engineers.
Pichai is at all times seeking to integrate AI into its search engine while also needing to reassure investors who fear such a move will cannibalize promoting revenue.
The search giant still controls 90 percent of the market, but for the primary time in many years is facing real competition from AI-powered products from groups like OpenAI, Anthropic and Perplexity that may provide comprehensive answers slightly than links.
Google's previous solution was “AI digests,” short answers to queries at the highest of the outcomes page. Executives said the feature was popular, but early evidence suggests users are clicking on dashboard ads less often – down 8 percent year-on-year, in keeping with data within the third quarter Research from the promoting platform Skai.
Other threats remain. After losing a significant antitrust case against its search division in August, the Justice Department is attempting to force the sale of its Chrome browser, end an exclusive contract as Apple's default search engine and share the trove of user data that underlies Google's proprietary website rankings -Algorithms, ad targeting systems and AI model training.
The company is awaiting the outcomes of one other U.S. monopoly attempt focused on its ad tech business, when Alphabet's other foremost income could possibly be broken up.
Another potential threat is Elon Musk. The world's richest man has power over President-elect Donald Trump after spending $250 million to assist win the US election last month – giving him the ability to influence AI regulation and antitrust enforcement.
Musk's xAI start-up also built the world's largest supercomputer in record time in Memphis, Tennessee. The company, nicknamed “Colossus,” has connected 100,000 cutting-edge Nvidia GPUs – and plans to expand the info center tenfold to 1 million chips – which should help xAI's chatbot Grok sustain with the competition in 2025.
“Sundar seems more confident now. Because Google's ethos is to be perfectionist, we may even see product launches at a more careful and calculated pace, but we mustn't be so impatient about it,” AllianceBernstein's Hsia said. “This is a race and up to date developments show they’re still in it.”
