More than 30 percent of new code at Google is now generated by artificial intelligence (AI), up from 25 percent in October, the tech giant’s parent Alphabet chief executive officer Sundar Pichai said on April 24. He was responding to an analyst query on how the company is leveraging generative AI internally to boost productivity.
"This has been an extraordinary amount of focus and excitement internally, both because I think the early use cases have been transformative in nature, and it still feels like early days and long ways to go," Pichai said during the company's Q1 earnings call.
The company continues to make significant progress in terms of people using coding suggestions. "More importantly, we have deployed deeper flows, and particularly with the newer models, I think we are working on early agentic workflows and how we can get those coding experiences to be much deeper," he said.
Beyond that, Alphabet is integrating generative AI capabilities across all parts of the company. "It's deeply embedded in everything we do...including the finance team preparing for this earnings call" he said.
"Our customer service teams are deeply leading the way there. We have both dramatically enhanced our user experience, as well as made it much more efficient to do so, and we are actually bringing all our learnings and expertise in our solutions through Cloud to our other customers."
In the past couple of years, Google has been simplifying its organisational structure to improve efficiency, re-engineer its cost base, and operate with greater speed and agility amid a high-stakes battle for AI supremacy with rivals such as OpenAI, Microsoft, Facebook parent Meta and Perplexity.
The company has unified teams in research, machine-learning infrastructure and developer teams, as well as its security efforts and its platforms and devices team.
Google has also carried out multiple rounds of layoffs across several of its businesses while continuing to hire in areas crucial to its AI initiatives.
In October, Google moved the Gemini app team to Google DeepMind to speed up deployment of new models, and streamline post-training work.
Earlier this month, Google replaced Gemini lead Sissie Hsiao with Josh Woodward who leads the company's Google Labs unit.
Hsiao led the firm's efforts to build the AI chatbot Bard, Google's answer to OpenAI's ChatGPT, which was later rebranded as Gemini.
Woodward oversaw the launch of NotebookLM, a note-taking and research assistant tool that went viral for its ability to transform text documents into podcast-style conversations.
Also read: Google parent surpasses 270 million paid subscriptions, driven by YouTube and Google One
All Google products now use Gemini
During the call, Pichai said each of Google's 15 products with a half billion users now uses Gemini models. "Android and Pixel are two examples of how we’re putting the best AI in people’s hands, making it super easy to use AI for a wide range of tasks, just by using their camera, voice or taking a screenshot," he said.
It is also replacing Google Assistant on mobile devices with Gemini, and later this year, it plans to upgrade tablets, cars and devices that connect to the user's phone, such as headphones and watches.
Pichai said AI Overviews, Google's AI-powered search experience, now has more than 1.5 billion monthly users, nearly a year after its rollout.
In March, the company introduced AI Mode, a new experimental feature that builds on AI Overviews with advanced reasoning, thinking, and multimodal capabilities to provide more in-depth responses to users' queries and compete with products like Perplexity and ChatGPT search.
"On average, AI Mode queries are twice as long as traditional Search queries. We are getting really positive feedback from early users about its design, fast response time, and ability to understand complex, nuanced questions" Pichai said.
Google also continues to see significant growth in multi-modal queries, Pichai noted. "Circle to Search is now available on more than 250 million devices, with usage increasing nearly 40 percent this quarter. Monthly visual searches with Lens have increased by 5 billion since October," he said.
In February, Pichai said Alphabet plans to invest around $75 billion in capital expenditures in 2025 to accelerate its AI efforts.
"We are still planning to invest approximately $75 billion in capex this year. We do see a tremendous opportunity ahead of us across the organisation, whether it is to support Google services, Google Cloud, and Google DeepMind," CFO Anat Ashkenazi said in the earnings call.
Overall, Alphabet's revenues saw a 12 percent growth to $90.23 billion for the quarter. Net profit grew by 46 percent to $34.54 billion.
The company's core advertising business saw an 8.5 percent increase in revenues to $66.9 crore for the quarter, while the cloud unit posted a 28 percent rise to $12.3 billion, led by growth in Google Cloud Platform (GCP) across core GCP products, AI Infrastructure, and Generative AI Solutions.
"Our differentiated, full stack approach to AI continues to be central to our growth. This quarter was super exciting as we rolled out Gemini 2.5, our most intelligent AI model, which is achieving breakthroughs in performance, and it’s widely recognized as the best model in the industry," Pichai said.
That said, Google is facing the threat of a breakup by the US government, following a federal judge's ruling in August 2024 that the company violated antitrust laws to maintain its online search monopoly. The US district court is hearing arguments to determine remedies for this case.
Earlier this month, a US judge also ruled that Google illegally monopolised some online advertising technology markets, dealing yet another setback for the company.
Google stated that it would appeal the part of the case that it lost. "We disagree with the Court’s decision regarding our publisher tools. Publishers have many options and they choose Google because our ad tech tools are simple, affordable and effective," Lee-Anne Mulholland, Google’s vice president of regulatory affairs, said at the time.
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