Alphabet Commemorates DeepSeek’s Achievement Amid Surge in AI Investments
Last week, the expanding AI budgets faced a bumpy ride following the DeepSeek crash, which negatively influenced Nvidia’s stock. Speculation surrounded the possibility that its lower-cost AI models might lessen the needs for AI chips and data centers.
Sundar Pichai, the CEO of Alphabet, certainly recognized the Chinese AI company’s advancements, describing them as “remarkable” during the latest earnings call, while also highlighting the competitive edge of some Gemini models.
Nonetheless, like Meta, Alphabet is not retreating from the intense AI spending race among major tech players. In its recent earnings report, Alphabet revealed intentions to elevate its capital expenditures to $75 billion this year — a notable 42% increase — to fast-track its AI projects.
Alphabet believes that making AI more accessible will significantly enhance the demand for its services rather than making them practically free and jeopardizing its business frameworks. The company underscored that it stands to benefit from increased usage — referred to as inference — due to its large user base.
“One of the reasons we are so optimistic about the AI opportunity is that we know we can create exceptional use cases because the costs associated with accessing it are expected to continue decreasing, allowing more applications to become feasible,” Pichai remarked during the earnings call. “That’s the opportunity we are concentrating on. It’s incredibly substantial, which is why we are investing to capitalize on that moment.”
Mark Zuckerberg, CEO of Meta, shared comparable sentiments during Meta’s earnings call last week, committing to invest “hundreds of billions” in AI over the long term, despite the distractions posed by DeepSeek.
While the future remains uncertain, currently, tech giants seem capable of handling their AI investments, and the timing of when (or if) they will scale back is still under consideration.