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HomeBluechipsMicrosoft Corp. (NASDAQ: MSFT) 'Deep-Segment AI' Reignite As They Look To Keep...

Microsoft Corp. (NASDAQ: MSFT) ‘Deep-Segment AI’ Reignite As They Look To Keep Up; Alphabet Inc.’s (NASDAQ: GOOGL)


Microsoft Corp. (NASDAQ: MSFT) and Alphabet Inc.’s (NASDAQ: GOOGL) Google used their investor calls to highlight what’s next: artificial intelligence after quarterly results were boosted by their established search and cloud-computing businesses.

Investors appeared to prefer Microsoft’s theory, pushing its shares up as high as 7.7% in premarket trading before the New York markets opened, but Alphabet rose less than 2%.

In their individual results calls on Tuesday, the tech titans, which are increasingly competing for the future of search, provided dramatically different estimates of how much upheaval the sector will face. Google officials urged investors to put their faith in the company’s lengthy history as the world’s premier search engine, and portrayed AI as simply another transition in its ever-changing business. Microsoft has hinted that something even more spectacular is in the works.

Microsoft said that its growth remained moderate in the fourth quarter as economic concerns dampened consumer and business demand for the company’s software and cloud services. After years of expansion, Microsoft’s cloud-computing business, which has been the engine of its recent growth, has begun to slow. The corporation reported a 27% increase in sales in its Azure cloud-computing division in the most recent quarter.

Until recently, Google was thought to be all but untouchable in the internet search business, which it dominated globally. That changed when OpenAI’s immensely successful chatbot, ChatGPT, debuted. Microsoft has begun incorporating OpenAI’s technology into its Bing search engine, putting pressure on Google to redesign its core search business to allow for more of the conversational dialogues that generative AI enables.

Speaking to investors, Alphabet CEO Sundar Pichai emphasized that Google is investing substantially in AI, but he downplayed what the technology will imply for the company’s lifeblood, search advertising. He expressed confidence that customers would continue to appreciate online advertising even if their queries resulted in a summary generated by a massive language model rather than the familiar list of links that Google has historically provided.

“We’ve gone through many, many shifts in search over the years,” Pichai added. “And I think we’ve always had a strong, grounded approach in terms of how we evolve ads as we’ve evolved search.”

Nonetheless, Microsoft CEO Satya Nadella stated that his business is a formidable competitor. He claims that app installations have doubled since the February debut of the AI-powered Bing. He also stated that Bing gained market share in the United States throughout the quarter, without providing exact figures.

“We look forward to continuing this journey in what is a generational shift in the largest software category search,” Nadella said during the results call.

Google’s agreements with Android phone makers give another potential for Microsoft to gain momentum. Nonetheless, Pichai predicted that Google’s lengthy track record will prevail.

“When we collaborate with our partners, we work hard to create a win-win experience,” Pichai explained. “In the end, partners choose us because that is what their users want.”

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