In Alphabet's recent earning calls, Sundar Pichai said that Google relies on Artificial Intelligence to generate a quarter of its new code. The tech giant, highlighting its strong financials last quarter, attached significant importance to how Google is continuously redefining user experience - while depending on AI internally at the same time. Likewise, on the financial end, the company is seeing an applaudable turnaround - with a 34% increase in net income year over year.
Using AI to write code is nothing new. Let's be honest; we've all used AI at least once to wrap up that one specific assignment or grasp a new concept. However, the fact that an industry leader like Google writes 25% of its new code is both intriguing and unsettling at the same time. Sundar Pichai says, "Today, more than a quarter of all new code at Google is generated by AI, then reviewed and accepted by engineers." Of course, AI is not self-aware, at least not yet, and every line of code has to be monitored by senior developers. But this poses a real threat to up-and-coming programmers.
Google is also revamping how we search things on the internet through AI. Meet AI Overviews, which accumulate results online and offer a summarized overview. “In Search, our new AI features are expanding what people can search for and how they search for it." While, in theory, this is a step in the right direction, the model tends to slip up occasionally. We should also highlight that Google could be forced to split up in light of an anti-trust lawsuit by the Department of Justice pinning Google's monopoly in the Search Engine market.
Overall, Alphabet's financials are solid as the recent influx in AI services to mainstream customers and a surge in YouTube Ad revenue landed the giant a respectable 15% increase in revenue at $88.2 billion compared to last year. Interestingly, the operating income for Google Services is up by 28%, even when you factor in the costs of running those AI models. Google Cloud, offering cloud computing and generative AI solutions, sees a substantial 7.3x uplift in the operating income at $1.94 Billion.
All things considered, it appears that Google's more AI-centric approach is working. While threats about potential job displacements are still looming, Google is doing all it can to appease shareholders and maintain its status in the market.
