Google-owner Alphabet (GOOG:NASDAQ) hasn’t been shooting any AI (artificial intelligence) lights out lately, but the launch of its Gemini AI model could mark a significant leap in the tech giant’s quest to regain dominance in the sector

That’s clearly the thinking among Wall Street analysts, who dished out a swathe of positive updates on Alphabet helping blow the cobwebs off a stock which hadn’t made much real ground since August. The shares surged more than 5% in response, adding an extra $80 billion-odd to its market cap.

JP Morgan analysts noted that the launch of Gemini addresses investor concerns about the high costs associated with running generative AI models, showcasing the firm’s commitment to innovation in the AI landscape.

Despite Alphabet’s big push in AI research, it is rival Microsoft (MSFT:NASDAQ) which has carved a lead in the race for AI-driven cloud revenue, an area where growth slowed for Alphabet in the September quarter.

Reuters cited Ken Mahoney, president of Mahoney Asset Management in New Jersey, as acknowledging that some critics might label Alphabet as late to the AI party. However, Mahoney emphasised that the company’s commitment to getting it right and seizing its opportunity in the AI space positions Gemini as a crucial driver for the company’s growth. The full bells and whistles version of the model is set for launch early in 2024, most likely in January according to speculation.

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