Google Reports Positive Results, Focus on AI

Google’s parent company Alphabet announced its first quarter results. With a 15% increase in revenue year-over-year, the tech conglomerate states that going forward, it will focus its investments on AI.

Google’s revenues reached just over $80 billion in the first quarter – above its projections of $78.59 billion – and more generally outperformed in sales and advertising.

“Our strong financial results for the first quarter reflect revenue strength across the company and ongoing efforts to durably reengineer our cost base,” Ruth Porat, President and Chief Investment Officer, said in a statement.

Following the positive results, Alphabet announced its Board of Directors approved a cash dividend for the first time, offering shareholders $0.20 per share. It highlighted that it intends to offer dividends quarterly going forward.

It also announced a $70 billion stock buyback program. The announcement caused Alphabet’s share to grow by 16% during after-hours trading.

Alphabet CEO Sundar Pichai shared that “results in the first quarter reflect strong performance from [Google’s] Search, YouTube, and Cloud.” He went on to say, “We are well under way with our Gemini era and there’s great momentum across the company. Our leadership in AI research and infrastructure, and our global product footprint, position us well for the next wave of AI innovation.”

A few days prior to announcing its financial results, Google advised that it would be putting more focus on AI going forward, consolidating teams from Research and Google DeepMind together in Google DeepMind. It will focus the Google Research teams on three key areas: computing systems (including quantum), foundational ML and algorithms, and applied science and society.

Google remains steadfast in its goal to deploy “accurate, trustworthy, and transparent AI products.” Included in the reshuffle are the Responsible AI teams, which will move from Research to Google DeepMind so that they are closer to the teams that build AI models.

Beyond the structural changes, Google will be standardizing its requirements to launch AI-powered features, which includes increased investment in “red team” testing of AI features to better identify risks prior to launch.

Google has identified several areas to monetize AI, for example, adding Gemini to ad products such as Performance Max, improving its Cloud offering for enterprise customers and enriching its subscription service by adding Gemini models to premium plans in Google One.