Google’s rising holidues season ad -sale is not enough to ease the worries of AI LetDown

On By Littum

San Francisco (AP) – Google’s sale of digital ad continued to grow by a healthy clip during the holiday season, but it was not enough to offset investors’ concerns about whether its great efforts on artificial intelligence will be lucrative as it once imagined .

The results of October-December, released Tuesday by Google Parent Alphabet Inc., showed that the company continues to reap even more profits from its dominant search engine and other peripheral services.

Alphabet earned $ 26.5 billion, or $ 2.15 per Share, during the last year’s last quarter, an increase of 28% from the same time in the previous year. Revenue increased 12% from the previous year to $ 96.5 billion. The earnings Eclipsed Analyst forecasts of $ 2.13 per Share, but revenue fell slightly under projections, according to Factset Research.

More importantly, the turnover growth in the Google Cloud Division was tied to AI -Dille was not as robust as expected.

This Letdown contributed to a fall of more than 8% in the alphabet share price after the number came out. Downturn reversed a recent demonstration that had increased Alphabet’s shares to a new high time earlier Tuesday during the regular trade session.

“The reaction emphasizes concern that competitors like Microsoft with his Openai Partner’s company are better positioned to convert AI hype to revenue,” investing.com analyst Jesse Cohen said.

But AI-generated summaries The fact that Google has increasingly appeared at the top of its search results seemed to help get more advertising. Google’s ad sales rose 11% from the previous year to $ 72.5 billion to exceed analyst estimates.

“The early characters suggest that AI is working for Google,” said Jim Yu, CEO of Brightedge, who helps sites rank higher in search results. “What it does for Google is to keep more of the digital experience happening within its search engine. And when they send someone to another place, shoppers and readers have already come further down their journey. So visitors are very worthwhile to An advertiser.

But Google has also spent billions of dollars on its AI extension, a huge investment that some investors question after t The Chinese Start -up Deepseek Found an effective way to implement similar technology for a fraction of costs. Alphabet expects its current AI extension to increase its capital from around $ 60 billion last year to $ 75 billion this year.

Alphabet CEO Sundar Pichai tried to reassure investors for everyone that spending will pay off during a Tuesday conference call by emphasizing how AI helps increase Google’s wealth by attracting more search traffic and making other services more popular.