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However, some analysts believe the new Google AI-powered Bard will outshine its competitors like Microsoft by a huge margin in the future.
Alphabet Inc Cl A (NASDAQ: GOOGL) shares closed Wednesday trading at $99.37, down approximately 7.68 percent from the day’s opening price. The sudden stock decline coincided with an event live-streamed by Google executives from Paris who unveiled an experimental conversational AI service, powered by LaMDA, dubbed Bard. The event came a day after Microsoft Corporation (NASDAQ: MSFT) launched its latest AI technology for its search engine Bing. However, the Google AI event has been disapproved by several analysts who cited little incremental news.
Google Pushes AI Innovations
According to Sundar Pichai, CEO of Google and Alphabet, the experimental conversational AI service will be opened up to trusted testers ahead of making it more widely available to the public in the coming weeks. Powered by Language Model for Dialogue Applications (LaMDA), Bard intends to help Google users achieve the best search results.
“Bard seeks to combine the breadth of the world’s knowledge with the power, intelligence and creativity of our large language models. It draws on information from the web to provide fresh, high-quality responses,” Pichai noted in a blog post.
Nonetheless, analysts at Evercore Inc (NYSE: EVR) said there was little incremental news from Google’s AI event, which may have contributed to the falling stock price. The analysts said they believe this was an early and perhaps rushed look at the AI Google has been working on for years.
However, some analysts believe the new Google AI-powered Bard will outshine its competitors by a huge margin in the future.
“Search improvements will act as a tailwind to [advertising revenue long term], but it will take time to bring users back to Bing and they will need a crowbar to pry away advertisers from Google,” Jefferies’ analyst Brent Thill wrote in a Tuesday note. “We view these updates as the tip of the iceberg for MSFT’s AI capabilities, with the largest opportunity in enterprise use cases”.
Alphabet continues to focus on deep computer science with the help of artificial intelligence (AI). According to the company’s fourth-quarter earnings results, Alphabet posted total revenues of $76 billion, up 1 percent YoY basis. The company posted total revenues of $283 billion for the full year 2022, thereby representing an increase of 10 percent YoY.
The introduction of AI technology has resulted in a reduction in Alphabet’s workforce. In January, the company announced 12,000 layoffs, thus saving approximately $0.5 billion in office operational costs.
According to market data provided by MarketWatch, GOOGL shares have gained approximately 18 percent in the past three months. With a market valuation of about $1.99 trillion, 51 analysts gave GOOGL shares an average rating of Buy.