Since the launch of ChatGPT three years ago, analysts and technologists ¡ª even a Google engineer and the company¡¯s former chief executive ¡ª have declared Google behind in the high-stakes race to develop artificial intelligence. Not anymore.
The internet giant has released new AI software and struck deals, such as a chip tie-up with Anthropic PBC, that have reassured investors the company won¡¯t easily lose to ChatGPT creator OpenAI and other rivals. Google¡¯s newest multipurpose model, Gemini 3, won immediate praise for its capabilities in reasoning and coding, as well as niche tasks that have tripped up AI chatbots. Google¡¯s cloud business, once an also-ran, is growing steadily, thanks in part to the global rush to develop AI services and demand for compute.
And there are signs of rising demand for Google¡¯s specialized AI chips, one of the few viable alternatives to Nvidia¡¯s dominant gear. A report on Monday that Meta Platforms is in talks to use Google¡¯s chips sent shares of its parent, Alphabet, soaring. The stock has added nearly $1 trillion in market capitalization since mid-October, helped by Warren Buffett taking a $4.9 billion stake during the third quarter and broader Wall Street enthusiasm for its AI efforts. The company is on track to hit a $4 trillion market capitalization for the first time. SoftBank Group, one of OpenAI¡¯s biggest backers, fell to a two-month low on Tuesday on worries about the competition from Google¡¯s Gemini. Nvidia shares fell as much as 5.51% on Tuesday, erasing $243 billion in market value.
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