San Francisco (AFP) – Microsoft and Google on Thursday lowered their quarterly profit forecasts as the tech giants continue to invest heavily in artificial intelligence, which they promise will transform the way people live.
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Wall Street investors cheered the results, pushing Alphabet's stock price up more than 11 percent and sending Microsoft's stock up nearly 4 percent in post-market trading.
Google's parent company Alphabet reported a profit of $23.7 billion on revenue of $80.5 billion, driven by growth in cloud computing, YouTube and online search advertising.
Alphabet and Google CEO Sundar Pichai says artificial intelligence has helped drive the Silicon Valley tech giants' businesses forward.
“We're well underway in the Gemini era and there's great momentum across the company,” Pichai said, referring to the Gemini AI model that powers services across Google's platforms.
“With our leadership in AI research and infrastructure, and global product deployment, we are well-positioned for the next wave of AI innovation.”
Google's cloud computing division brought in about $9.5 billion, compared with $7.5 billion a year earlier.
Google also announced its first-ever dividend of 20 cents per share.
“Things are looking good for Google,” said Evelyn Mitchell Wolf, senior analyst at eMarketer.
But the future of Google's core search business is not guaranteed, analysts warned.
Google is facing an antitrust lawsuit in the U.S., and adding AI-generated content to its main search engine “will probably be the biggest change to the search advertising market since its inception,” Mitchell-Wolf said. Ta.
The gains come as Google, Microsoft, Amazon and other rivals competing in the hot field of AI face increased scrutiny from U.S. and European regulators.
Earlier this year, the U.S. Federal Trade Commission announced an investment in AI as part of an effort to ensure regulatory oversight catches up with developments in the field and prevents major companies from crowding out competitors in a field expected to see seismic change in multiple areas. We have begun an investigation into the partnership. of business.
Amazon — through its Amazon Web Services division — Microsoft and Google, in addition to being some of the world's wealthiest companies, are the world's largest providers of cloud-based data centers that store and process large amounts of data. .
Microsoft CEO Satya Nadella said the company's revenue for the January-March period rose 17% from a year earlier to $61.9 billion, and net income rose 20% to $21.9 billion.
Microsoft has been aggressively deploying generative AI, starting with a $13 billion partnership with ChatGPT developer OpenAI in 2023, and has since reaped significant rewards from investors.
The introduction of AI has boosted sales of key cloud services such as Azure, which has become a core part of Microsoft's business under Nadella's leadership.
Cloud giants Amazon and Google are also looking to shore up cloud sales by rolling out AI capabilities to customers, proving that the AI revolution is more than just hype.
In that push, Microsoft has gone beyond OpenAI, entering into partnerships with other promising AI startups such as Mistral AI and making significant investments internationally.
Microsoft also announced in March that it had hired Mustafa Suleyman, co-founder of DeepMind AI and Inflection AI, to lead its AI division, poaching one of the industry's key players from a promising startup.
revolution unleashed
The moves have often surprised archrival Google and seen Microsoft overtake Apple, the world's largest publicly traded company.
“Microsoft's earnings demonstrate that the company is well-positioned to benefit from the AI revolution it helped deploy,” said Jeremy Goldman, senior director of briefings at Emarketer.
“Like Google, effectively monetizing AI remains a challenge, but Microsoft is positioning itself in an area where ad buying is considered, which wasn't necessarily the case even a few years ago.”
However, Wednesday's meta results were the first sign of AI fatigue.
Facebook's parent company said its quarterly profit soared last quarter, but its stock price fell on concerns over spending on artificial intelligence.
A potential dark cloud for AI comes as government regulators take a closer look at Microsoft's relationships with companies such as OpenAI, amid concerns that the giant is using vast sums of money to thwart the emergence of rivals. It's about being there.
Britain's competition watchdog on Wednesday became the latest to launch an investigation into partnerships between artificial intelligence companies and major US tech partners, including Microsoft.
© 2024 AFP
