Mountain View, California -Google’s CEO, Sundar Pichai, announced yesterday that over a quarter of the company’s new code is now generated by artificial intelligence, with engineers reviewing andapproving the AI-generated code. This revelation came during the company’s third-quarter earnings call, where Alphabet, Google’s parent company, reported exceeding Wall Street’s revenue targets.
The company’s strong financial performance is attributed, in part, to the success of its AI initiatives. Alphabet reported $88.3 billion in revenue for the quarter, surpassing the Wall Street target of$86.3 billion. Google Services, including search, generated $76.5 billion in revenue, marking a 13% year-over-year increase. Google Cloud, which includes AI infrastructure products for other companies,saw a 35% year-over-year growth, reaching $11.4 billion in revenue.
In Search, our new AI capabilities are expanding what people can search for and how they search, said Pichai in a statement. In Cloud, our AI solutions are helping to drive deeper adoptionof products by existing customers, attract new customers, and win larger deals. YouTube’s advertising and subscription revenue also surpassed $50 billion for the first time in the past four quarters.
Prior to the earnings call, Pichai had already expressed the company’s long-term focus and investment in AIare starting to yield returns among both business clients and consumers. He repeatedly highlighted Google’s rapid success in people and companies using its AI, particularly its various tools running on Google’s Gemini model. By any measure, whether it’s the number of tokens, API calls, consumer usage, business, etc., Gemini isexperiencing a period of rapid growth, he stated.
These developments come amidst a period of significant restructuring and team consolidation at Google. The company has integrated more teams under its core AI division, DeepMind, and has seen a reduction of 1112 employees compared to a year ago. These changes are largely separate fromthe mass layoffs announced by Pichai earlier in 2023.
Google’s embrace of AI, particularly in code generation, represents a significant shift in the tech industry. The company’s success in leveraging AI to boost revenue and drive innovation is a testament to the growing power of this technology. As AI continues toevolve, it will be interesting to see how Google and other tech giants further integrate it into their operations and products.
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