Goldman Sachs analyst Eric Sheridan reiterated Alphabet Inc
On Wednesday, Alphabet unveiled the latest version of its flagship multimodal AI model, Gemini 2.0. With Gemini 2.0, Alphabet has achieved a step-function improvement in model performance, the analyst says.
Alongside the launch, Alphabet showcased a wider array of capabilities powered by the new AI model.
In addition to applying Gemini 2.0 to improve existing AI applications and use cases, several new announcements move Alphabet closer to its vision of offering agent-based systems.
According to the analyst, these systems would able to fulfill a wider variety of tasks on a user's behalf, which the company first laid out with Google Duplex at Google I/O 2018 and has iterated on in subsequent years.
In addition, and while its potential impact is longer-lasting, earlier this week, Alphabet announced Willow, its new quantum computing chip that shows a significant improvement in performance and error rates while lacking economies of scale and well-defined consumer use cases at present.
Willow represents a potential dramatic computing shift that will evolve in tandem with AI but over a long-term timeframe, the analyst writes.
Sheridan came away from this series of announcements increasingly convinced that Alphabet is well positioned longer-term against the rise of AI across various aspects of the enterprise and consumer computing landscape.
It remains at the forefront of all aspects of forward computing innovation. Gemini 2.0 showcases Google's market leadership position as one of only a few large-scale LLMs with advanced multimodal capabilities.
Despite some "commoditization" within the AI large language model layer, implementing and integrating AI into consumer-facing and enterprise-facing applications will be crucial for generating wide-scale adoption.
Sheridan is positive on Google's ability to capitalize on this theme longer-term and expects new AI developments to rapidly gain scale of adoption by leveraging its global user base and suite of apps and services.
Sheridan projected fiscal 2024 revenue of $295.25 billion and EPS of $8.
Price Action: GOOGL stock is down 0.44% at $194.45 at last check Thursday.
