Alphabet's (GOOGL) Google Rides on Gemini in Generative AI Game

Zacks Equity Research
·4-min read

Alphabet GOOGL is continuously riding on its growing generative AI capabilities. Shares of the company have rallied 24.4% year to date, outperforming the Zacks Internet Services industry’s growth of 19.3%.

In order to deliver generative AI experience across its products and services, Google is constantly making efforts to power them with its most advanced and powerful large language model (“LLM”), namely Gemini.

Reportedly, the company is planning to add a Spotify extension to Gemini in order to deliver an enhanced music streaming experience to Gemini users.

This comes right after the recent rollout of YouTube Music Gemini Extension, which enables users to search music and play radio, among others, with the help of an AI chatbot experience.

These endeavors are expected to aid Alphabet in gaining momentum in the music streaming space.

Alphabet Inc. Price and Consensus

 

Alphabet Inc. Price and Consensus
Alphabet Inc. Price and Consensus

Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote

Growing Generative AI Efforts Aid Prospects

Per a Fortune Business Insights report, the global generative AI market size is expected to hit $67.2 billion in 2024 and reach $967.7 by 2032, seeing a CAGR of 39.6% between 2024 and 2032.

Alphabet is well-poised to capitalize on the above-mentioned prospect, thanks to its growing generative AI efforts.

Recently, Google upgraded Android Studio's bot with Gemini Pro, which will enable developers to ask coding-related questions. Users will be able to add generative AI-powered features to their apps seamlessly by accessing the Gemini API starter template through Android Studio.

The company also made Gemini 1.5 Pro available in a public preview on Vertex AI.

Google unveiled LearnLM, a family of generative AI models designed for conversational tutoring on various subjects.

Its introduction of the latest additions to the Gemma family of open models, including Gemma 2, the next generation with a 27-billion parameter model, and PaliGemma, the first vision language model for image captioning, labeling and Q&A use cases, remains noteworthy.

Google also introduced various open-source tools to support generative AI projects and infrastructure. The new tools include the likes of MaxDiffusion — a collection of reference implementations of various diffusion models, JetStream — a new engine to run generative AI models, MaxText — a collection of text-generating AI models targeting tensor processing units (TPUs), and NVIDIA’s NVDA GPUs in the cloud.

Strengthening generative AI capabilities across various products will help Google deliver enhanced user experience, which, in turn, is expected to aid Alphabet’s overall financial performance in the days ahead.

The Zacks Consensus Estimate for 2024 revenues is pegged at $295.53 billion, which indicates year-over-year growth of 15.2%. The same for 2024 earnings stands at $7.60 per share, which implies year-over-year growth of 31%. The EPS estimate has moved 0.4% north over the past 30 days.

Competitive Scenario

The Zacks Rank #1 (Strong Buy) company’s growing generative efforts are making the battle intensified for its peers like Microsoft MSFT and Amazon AMZN, which are also flexing muscles to bolster generative AI capabilities.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Microsoft continues to make strong efforts to boost its generative AI capabilities. Its integration of GPT-4 into its search engine Bing and browser Edge to deliver a ChatGPT-like experience to users remains noteworthy.

Microsoft Azure offers the Azure OpenAI Service, which enables the seamless application of LLM and generative AI techniques in various use cases. It recently launched the latest copilot templates on Azure OpenAI Service that allow retailers to build personalized shopping experiences and support store operations.

In addition, Microsoft and OpenAI are reportedly collaborating on an ambitious venture to establish a cutting-edge data center project to address the imperative need for advanced infrastructure to manage generative AI-driven complex data and tasks.

Then again, Amazon’s AWS is riding on Amazon Bedrock, which has provided it with a breakthrough in the generative AI space. Amazon Bedrock offers seamless access to high-performing foundation models from AI companies through an API.

Its latest partnership with NVIDIA to power its portfolio with the generative AI technology is another positive. Per the terms, the NVIDIA Blackwell GPU platform will be available on AWS. This will help speed up inference workloads for resource-intensive, multi-trillion-parameter language models.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Amazon.com, Inc. (AMZN) : Free Stock Analysis Report

Microsoft Corporation (MSFT) : Free Stock Analysis Report

NVIDIA Corporation (NVDA) : Free Stock Analysis Report

Alphabet Inc. (GOOGL) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

  • Up next
  • Up next
  • Up next
  • Up next

Latest stories

  • Huawei exec rejects idea that advanced chip shortage will hamper China's AI ambitions

    A senior executive at Chinese technology giant Huawei on Thursday dismissed the idea that a shortage of the most advanced artificial intelligence chips will hinder the country's aim to be a leader in AI, but said innovation is needed to address the issue. The comments by Zhang Ping'an, CEO of Huawei Cloud, comes amid tighter U.S. restrictions on advanced AI chip shipments to China including a ban on sales there by companies such as U.S. giant Nvidia. "Nobody will deny that we are facing limited computing power in China... But we cannot rely solely on having the AI chips with the advanced manufacturing process nodes as the ultimate foundation for AI infrastructure,” Zhang told a forum at the World AI Conference in Shanghai, a three-day event that kicked off on Thursday.

  • When is iPhone 16 release date? Leaked prices, features, and colours for Apple’s AI powerhouse

    A cheaper iPhone packed with ChatGPT-style AI tricks? This is what we know about Apple’s next big smartphone

  • Paramount, Skydance Merger Is on Again in $2.4 Billion Deal

    But NAI's controlling shareholder Shari Redstone might be setting off a bidding war ahead of Sun Valley The post Paramount, Skydance Merger Is on Again in $2.4 Billion Deal appeared first on TheWrap.

  • Japan breaks Internet speed record by hitting 402 Tbps, so fast you could download Elden Ring in a millisecond

    Japanese researchers have set a new internet speed record using standard fiber optic cables paired with new amplification technologies.

  • Broadcom Up 24% in a Month: How to Play AVGO Ahead of Split?

    Broadcom's (AVGO) strong portfolio and expanding AI offerings make its top-line growth prospects bright.

  • BP CEO Halts Offshore Wind Projects, Enacts Hiring Freeze

    BP's new CEO Murray Auchincloss has implemented a hiring freeze and paused new offshore wind projects, shifting the company's focus to oil and gas to address investor concerns over its energy transition strategy.

  • Mondelez (MDLZ) Navigates Hurdles Through Portfolio Strength

    Mondelez's (MDLZ) focus on core categories and portfolio strength place it well in a challenging and dynamic operating environment.

  • SLB and TotalEnergies Ink 10-Year Digital Solutions Partnership

    SLB and TotalEnergies enter into a 10-year collaboration to co-develop scalable digital solutions, focusing on enhancing energy resource access and efficiency through advanced AI technologies.

  • Super Micro Computer (SMCI) Up 194.5% YTD: Is it Worth Buying?

    Super Micro Computer (SMCI) is making strides in the AI infrastructure market, which makes the stock worth a watch.

  • iPhone theft victim is sent death threats and gun video after tracking his device to China

    Christopher Bramah-Calvert told to release his stolen iPhone 13 from his Apple account or his family will be ‘slaughtered’ after he tracked device to Shenzhen in southern China

  • Paramount Stock Rises on New Skydance Merger Offer

    UPDATED: Shares of Paramount Global sprang to life ahead of the July 4 holiday on a renewed agreement between Skydance Media and controlling shareholder Shari Redstone that would merge Skydance and Paramount. On Wednesday (July 3), Paramount’s stock opened up 13% to over $12/share, its highest levels in nearly a month. However, the price drifted …

  • Bitcoin Sinks Under $61K as One Trader Sticks to $150K Prediction This Year

    U.S.-listed ETFs ended a five-day inflow streak with $13 million in net outflows on Tuesday.

  • London stocks, pound climb as Britons vote

    London's stock market and the pound advanced versus the dollar Thursday as Britons voted in a general election expected to be won by the centre-left and main opposition Labour party."Today's UK election looks unlikely to cause too many shockwaves given just how resounding the Labour party victory is expected to be, with markets feeling optimistic over the potential change at Downing Street," said Scope Markets analyst Joshua Mahony.

  • Singapore’s DBS boosts digital-asset push with first stablecoin tie-up

    Singapore’s largest bank DBS Group Holdings Ltd. will for the first time custody stablecoin reserves and offer related cash management services, in a tie-up with the local unit of cryptocurrency issuer Paxos Trust Co.

  • US market exceptionalism is approaching its dramatic denouement

    The investment focus naturally shifts to the US on Independence Day but more so than ever this year as the completion of elections here on Thursday and in France at the weekend moves the political spotlight across the Atlantic too.

  • Japan's Nikkei 225 index hits a record high close of 40,913.65

    Japan’s Nikkei 225 stock index closed Thursday at a fresh record high of 40,913.65, pushing past its most recent record close set in March on heavy buying of automaker and technology shares. The index's all-time high during intraday trading is 41,087.75, set on March 22. The gains tracked an overnight rally on Wall Street, where the S&P 500 and tech-heavy Nasdaq also hit fresh records.

  • Canada posts third straight monthly trade deficit in May

    OTTAWA (Reuters) -Canada recorded a bigger-than-expected trade deficit of C$1.93 billion ($1.41 billion) in May, the third consecutive monthly shortfall, as exports declined faster than imports, data showed on Wednesday. Total exports fell 2.6% to C$62.45 billion, the lowest level in 10 months, while imports decreased by 1.6% to C$64.37 billion, Statistics Canada said, in what was seen as a broad-based decline in both exports and imports. Analysts polled by Reuters had forecast a C$1.20 billion trade deficit for the month.

  • Australia spy agency moves intelligence data to cloud in Amazon deal

    SYDNEY (Reuters) -Australia will move its top secret intelligence data to the cloud under a A$2 billion deal with Amazon Web Services that Defence Minister Richard Marles said would boost defence force interoperability with the United States. The Director General of the Australian Signals Directorate, Rachel Noble, said the national security agency would also increase its use of artificial intelligence (AI) to analyse data under the shift, which would see top secret data centres built in Australia.

  • Nvidia is the best way to play AI for the 'next 10 years'

    Nvidia (NVDA) shares are falling back today following the chipmaker's recent market high. Rosenblatt Securities senior research analyst Hans Mosesmann joins Market Domination to explain why he is not worried about the stock's bumpy previous weeks. Mosesmann has issued the highest price target for Nvidia on Wall Street. Mosesmann has a long-term view, explaining that the sale pressure is negligible when one considers that Nvidia is going to be the "best way to play AI for the next 10 years." He adds that Nvidia is not just a semiconductor company anymore but a platform that is "all things AI." For more expert insight and the latest market action, click here to watch this full episode of Market Domination. This article was written by Gabriel Roy

  • How to rebalance your portfolio for the second half of 2024

    As Wall Street heads into the second half of the year, Mitlin Financial founder and author of "Financial Planning Made Personal" Lawrence Sprung joins Wealth! to discuss the markets' (^DJI,^GSPC, ^IXIC) momentum and how it should inform your investing decisions. While past performance does not determine future performance, Sprung notes that historically, when there has been a strong first half, the momentum continued for the rest of the year. He believes the election will be a catalyst as it typically enhances market returns in an already strong year. He also explains that a possible interest rate cut could be another catalyst that drives higher returns. He encourages investors to review their portfolios mid-year and rebalance if necessary. Financials have been performing well in a higher interest rate environment and could tumble once a rate cut is initiated. Meanwhile, the energy sector will be sensitive to geopolitical events, which Sprung explains, "We can't time, but we can try to anticipate." For more expert insight and the latest market action, click here to watch this full episode of Wealth! This post was written by Melanie Riehl