Alphabet, the parent company of Google, reported a $15 billion net profit in the first quarter of 2023, above market estimates, indicating that the search engine powerhouse is finding its feet.
The IT titan has been put under pressure as a result of a general downturn in advertising spending, over-hiring during a Covid-era boom, and Microsoft’s huge challenge in artificial intelligence.
Its quarterly revenue was about $70 billion, a billion more than experts predicted, and during the same three-month period, the corporation announced the layoff of 12,000 employees or 6% of its workforce.
On Tuesday, Microsoft’s earnings for the first three months of the year satisfied investors, helped by its industry-leading business cloud offerings.
The business established by Bill Gates declared a profit of $18.3 billion on revenue of $52.9 billion, with Cloud and AI more than offsetting reductions in revenue from licensing Windows software to computer makers, since sales in that industry have been declining.
The majority of market attention was focused on Google, which became a source of concern after the Microsoft-backed ChatGPT was developed and swiftly became viral late last year. Microsoft has integrated the technology into its Bing search engine and Office software.
According to media reports, the search giant has subsequently pushed out Bard, its own version of the language-based AI, but the release was considered as amateurish and has so far disappointed outsiders and company insiders.
“We’ll continue to incorporate generative AI advances to make search better in a thoughtful and deliberate way,” Google chief Sundar Pichai said during an earnings call.
“And we will test and iterate as we go because we know that billions of people trust Google to provide the right information.”
An AI weapons race is projected to last several years and could be costly for the industry titans.
Google has reorganized its AI division to better prepare for the next AI battles, bringing the independently controlled Deep Mind subsidiary under the corporation in a section dubbed Google Brain.
