Google’s Product Revival Reshapes AI Competition

Alphabet has reasserted itself at the center of the global AI race, with investors and analysts pointing to a decisive shift in strategy and execution. After years of criticism for lagging rivals, Google’s recent launches are being framed as a long-awaited correction. Market sentiment has turned sharply in its favor.

Shares of Alphabet jumped more than 5% on Monday, building on an 8% rally the previous week. The gains followed disclosures that Berkshire Hathaway has taken a $4.3 billion stake in the company. Alphabet’s market value has now overtaken Microsoft’s, signaling renewed institutional confidence.

From setbacks to scale

Google’s struggles after the 2022 debut of ChatGPT were well documented. Analysts said the company failed to translate its deep research bench into competitive consumer products. That narrative began to change with the release of Gemini 3, which emphasizes faster, more accurate responses with less prompting.

Salesforce CEO Marc Benioff publicly endorsed the model, calling the improvement over previous versions “insane.” Such endorsements have helped reposition Google as a serious contender rather than a defensive incumbent. Experts say this marks a strategic inflection point.

Hardware fuels enterprise appeal

Beyond software, Alphabet is betting heavily on infrastructure. The launch of Ironwood, Google’s seventh-generation TPU, highlights a push toward power efficiency and large-scale AI workloads. The chip has already helped secure multibillion-dollar enterprise partnerships, including with Anthropic.

Analysts note that Google’s control over YouTube data gives it a structural advantage in training advanced video and image models. This combination of data and hardware is strengthening its enterprise pitch.

Challenges remain

Despite momentum, Google still trails OpenAI in overall user engagement. Executives acknowledge the pressure, noting that AI serving capacity must double every six months to keep pace with demand. Adoption of Gemini and AI Overviews is rising, but the race remains tight.

Even so, analysts largely agree that Alphabet has engineered a credible comeback. The company is once again shaping market expectations rather than reacting to them.