Alphabet held its quarterly earnings conference today (October 29th), but like the past few similar events, it was more about AI than revenue. But then again, that’s exactly what the company is aiming for. The company wants its products to become synonymous with AI, from Google to Android to YouTube.
“Our commitment to innovation and our long-term focus and investment in AI are paying off,” Alphabet CEO Sundar Pichai said in the company’s financial results for the third quarter ended September 30. , driving the success of our company and our customers.” “We are uniquely positioned to lead in the AI era with our differentiated full-stack approach to AI innovation, and we are now seeing this operationalized at scale.”
revenue numbers
Looking at the numbers, the company showed some softness in ad-based products like YouTube, and beat expectations in cloud computing. But most of the comments and all of the analysts’ questions revolved around AI, which Pichai said is being integrated into everything from search to shopping. These comments were long on strategy and a little short on details. For example, when asked by an analyst to estimate the number of users for Gemini and Gemini Advanced, Pichai said that more than 1 billion users around the world use it as part of their search functionality and that the company’s Gemini I just mentioned that API usage is 14x higher. past 6 months. How much is Alphabet spending? All I can say is that servers accounted for most of the $13 billion in capital spending in the third quarter, and we expect to spend even more in the fourth quarter.
“There are three elements[to the company’s AI strategy],” Pichai told the conference call audience. “First, our robust AI infrastructure, including data centers, chips, and a global fiber network. Second, we are advancing our research with advanced technology research in AI and building models that will enhance our efforts. And third, our broad global reach through products and platforms that impact billions of people and customers around the world, creating a virtuous cycle. .”
As several executives detailed on the conference call, YouTube is leveraging AI to power recommendations and provide creators with advanced video generation tools. Google Search has undergone major changes with new features in AI Overview, Circle to Search, and Lens to expand search capabilities and user engagement. Android devices, including Samsung Galaxy devices, are equipped with Gemini Nano, an advanced AI model that enables “Gemini Live.” This feature allows users to freely converse with Gemini, similar to the experience with Google Assistant.
Monetizing AI
But can AI be monetized? Pichar said Alphabet monetizes AI by building it into product-by-product experiences and integration into Google Cloud.
“We are clearly showing strong commitment,” he said. “This is one of the most user-satisfying initiatives we have ever undertaken in search, increasing overall search usage. People are asking more complex questions, different types of They’re looking at a broader range of websites, and what’s particularly interesting is that this growth actually increases over time as people learn to adapt to that new behavior. That’s it.”
On a different note, Pichai spoke for the first time during this earnings conference about the company’s response to U.S. District Judge Amit P. Mehta’s August 5 finding that Google had illegally maintained a monopoly. I was faced with the question of whether I intended to respond in the same way. Enter the general search services and general search text advertising markets through exclusive distribution agreements.
“People choose us, whether they’re consumers or partners, because they think we have the best product,” Pichai said. “And we have a long track record of working hard to make our products as easy as possible for users across all platforms. So all of that approach and all of the learnings over the years… , I think gives us a strong foundation. First of all, we plan to defend these cases vigorously, and some of the early proposals from the Department of Justice are far-reaching. I think there could be unintended consequences, especially for the dynamic technology sector and American leadership there. And we intend to do that, and we intend to engage very vigorously there. .”
More information: AI, Alphabet, Android, Artificial Intelligence, Connected Economy, Revenue, Google, Google Gemini, Google Pixel, News, PYMNTS News, Q3, Sundar Pichai, YouTube
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