Alphabet Drops Big Amidst DeepSeek News And AI-Spendings

Alphabet Inc. is facing mounting challenges as its shares plummeted by as much as 9% following a disappointing revenue report, raising concerns about its future in the competitive search engine landscape.

The company’s fourth-quarter earnings revealed a revenue of $96.47 billion, slightly below expectations, while its aggressive investment in artificial intelligence (AI) has sparked investor apprehension.

One of the most pressing concerns for Alphabet is the rise of Bing’s market share, which has increased from 2.18% to nearly 4% since February 2023, while Google’s share has dropped from 93.47% to 89.73% during the same period.

As of last update, this is how the search engine desktop market share looks like:

This shift indicates a growing competition that could threaten Google’s long-standing dominance in the search engine market.

Experts have noted that many users are beginning to express dissatisfaction with Google’s search quality, suggesting that the once-unassailable giant may need to innovate rapidly to maintain its user base.

Despite Alphabet’s ongoing efforts to enhance its AI capabilities through substantial investments—projected at $75 billion for 2025—its AI product, Gemini, has yet to gain significant traction in the ongoing AI war against competitors like OpenAI’s ChatGPT and Microsoft’s Bing Chat.

Analysts have pointed out that while Google continues to lead in terms of daily active users, it must address criticisms regarding search quality and user experience to fend off rivals effectively.

The situation is compounded by reports from search engine experts who claim that the overall quality of search results on Google has declined, prompting users to explore alternatives like Bing.

As Bing continues to refine its offerings and capture a larger segment of the market, Alphabet must navigate these challenges carefully or risk losing further ground in the rapidly evolving digital landscape.