TL; DR
- Google now generates 25% of its new code using AI, reviewed by human engineers to ensure quality.
- Alphabet’s Q3 2024 revenue rose by 15% to $88.3 billion, driven by Google Cloud’s 34% growth and increased revenue from search and services.
- Google plans major AI updates for 2025 across products.
Sundar Pichai, CEO of Google and Alphabet, recently disclosed a significant milestone for the company: 25% of Google’s newly generated code is now created by AI. This revelation came during Alphabet’s third-quarter earnings call, where Pichai highlighted the increasing role of AI in the company’s code development.
According to Sundar, Google engineers don’t merely use AI to generate code automatically. Instead, each piece of AI-generated code undergoes a review process by human engineers before being integrated into Google’s core codebase.
Sundar explained that this is aimed at enhancing productivity, allowing the engineers to do more and move faster. The tech giant has recently leaned into AI a lot, so much so that most of the Google products and services are now coated in AI.
As Google embraces AI, the company has invested heavily in AI-focused projects, such as Gemini, as well as a new division called Google DeepMind, which emerged from the merger of Google Brain and DeepMind. Also, Google has transferred the Gemini app team to work on Google DeepMind.
“Google is uniquely positioned to lead in the era of AI because of our differentiated, full-stack approach to AI innovation. And we are now seeing this operate at scale,” Sundar stated. He credited Google’s AI infrastructure, research teams, and vast user base for the AI adoption.
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Positive growth for Alphabet this quarter
All this investment in AI has also shown up in Alphabet’s financial performance. For Q3 2024, Alphabet reported a 15% year-on-year revenue increase to $88.3 billion, largely attributed to its Google Cloud services, which grew by 34% year-on-year to reach $11.4 billion.
Additionally, revenue from Google’s search engine, Maps, and other services rose by 13% to $76.5 billion. Sundar stated, “All seven products have done their first versions of incorporating Gemini AI models, and there’s an aggressive roadmap ahead for 2025.”
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Plans for 2025
Sundar confirmed that Google is gearing up for major AI upgrades in 2025, including several consumer AI features in existing Google products and services. This push is backed by Alphabet’s increased capital expenditure.
For perspective, the company spent $13.1 billion on capital acquisition for the third quarter, up by 62% from the same period last year, with the majority allocated to technical infrastructure like servers and data centers. It has even bigger plans for 2025, and it’s going to be a big year for AI.
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