Alphabet Inc. (GOOGL) stock slipped 1.5% on Tuesday after the company wrapped up its highly anticipated Google I/O 2025 conference in Mountain View, California. Despite new AI features and product updates, the event fell short of investor expectations, triggering a modest sell-off. Investors were particularly focused on the company’s AI strategy and its efforts to reinforce dominance in search. However, many AI tools and features announced won’t roll out for several months, leaving investors underwhelmed in the short term.
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Heading into the event, GOOGL stock was already down around 12% year-to-date. Investors hoped for some breakthrough, but the quiet reaction shows Wall Street expected more.
Google Steps Deeper Into AI – Must-Know Highlights from I/O 2025
Google I/O 2025 began with a strong focus on AI, highlighting how its Gemini AI will now be used widely across Google products. For instance, Gemini is being added to many of Google’s apps, allowing users to get directions, set reminders, and interact with Gmail and Calendar using natural commands.
Meanwhile, the highlight of the event was Google’s AI Mode, its latest generative AI search experience. Google is redesigning its search engine to work more like an AI chatbot, offering direct answers in a conversational style. Starting Tuesday, U.S. users can enable AI mode in Google Search and Chrome, similar to ChatGPT. Notably, CEO Sundar Pichai called it “total reimagining of search.”
Additionally, Google introduced a new premium AI subscription service for business users, priced at $249.99 per month—roughly $50 more than Microsoft (MSFT)-backed OpenAI’s top-tier offering. The service is powered by Google’s advanced Gemini 2.5 model.
What Else Google Revealed at I/O 2025
Another major reveal was Android XR, a new feature that brings Gemini to smart glasses and headsets. The tech giant is also teaming up with fashion brands like Gentle Monster and Warby Parker to make the glasses stylish, with some models even offering a built-in display in the lens.
Furthermore, Google launched Veo 3, its next-gen AI video model that generates video, audio, sound effects, and dialogue, available immediately. Pichai also introduced Google Beam, an AI-powered platform that turns 2-D video from multiple cameras into lifelike 3-D images, with early products launching this year.
Are Google Shares a Good Buy?
Overall, Wall Street analysts have a Strong Buy consensus rating on GOOGL stock based on 28 Buys and nine Holds assigned in the past three months. The average GOOGL price target of $197.69 per share implies a 20.6% upside potential.
