Shares of Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG) are higher in today’s trading session. This can be attributed to CEO Sundar Pichai’s plans to integrate conversational AI features into the company’s flagship search engine. Pichai believes AI advancements will help Google answer queries faster, and although he denies chatbots pose a threat to Google’s search business, he expects smaller AI models to become increasingly useful, allowing companies to create their own and users to run algorithms on personal devices. Pichai also aims to add AI features to work-related products such as Gmail.
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However, he faces investor pressure to cut costs and the threat of Microsoft’s (NASDAQ:MSFT) ChatGPT system, which has already been introduced into their Bing search engine. Google’s CFO Ruth Porat warned employees of more budget cuts, including in dining facilities and computing infrastructure.
Nevertheless, Wall Street remains positive on GOOGL stock despite Microsoft’s increasing competition. Indeed, analysts have a consensus price target of $129.68, implying 22.55% upside potential, as indicated by the graphic above.