Alphabet (GOOGL) Rolls out Gemini 2.5

Alphabet Inc. (NASDAQ:GOOGL) is one of the Top 10 Stocks to Buy According to Lakehouse Capital. The company’s investments in AI technologies position it well to capitalize on the upcoming wave of broad-based digital innovation. The integration of AI into the company’s core products, like search and advertising platforms, can help enhance user experiences and fuel engagement. This can result in increased ad effectiveness and revenue growth. In Q1 2025, Alphabet Inc. (NASDAQ:GOOGL) rolled out Gemini 2.5, which it believes is the most intelligent AI mode. It continues to achieve breakthroughs in performance and happens to be an extraordinary foundation for future innovation.

Alphabet (GOOGL) Rolls out Gemini 2.5

A user’s hands typing a search query into a Google Search box, emphasizing the company’s search capabilities.

Furthermore, in Q1 2025, Search saw strong growth, thanks to the engagement it is witnessing with features such as AI Overviews, which now has 1.5 billion users per month. Amidst increased competition, Alphabet Inc. (NASDAQ:GOOGL) continues to maintain numerous key advantages in the broader digital advertising space. Alphabet Inc. (NASDAQ:GOOGL)’s vast user data offers unparalleled targeting capabilities for advertisers. Its integration of AI into the advertising suite can help improve ad performance and ROI for marketers.

Qualivian Investment Partners, an investment partnership focused on long-only public equities, released its Q1 2025 investor letter. Here is what the fund said:

“Alphabet Inc. (NASDAQ:GOOGL) declined in the quarter due to (1) uncertainty regarding the returns on the large amount of capital expenditure being spent on generative AI investments and whether they will yield proper returns and (2) whether competing generative AI chatbots (Chat GPT, Perplexity, others) will take share away from GOOGL’s core search business.

GOOGL has been under a lot of pressure in recent months to prove it can be a winner in the AI search race. The company responded by introducing AI Overviews (AI-generated answers to search queries that appear at the top of the page). Reception to the AI Overviews has been encouraging, with consumers searching more frequently and clicking through at higher rates. GOOGL has also introduced ads on AI Overviews which are monetizing at similar rates as regular search ads.

In May , the company announced that it is integrating AI into its search engine through AI Mode. Users can make more complicated requests in a conversational chatbot interface, performing multi-step tasks like finding tickets or making reservations…” (Click here to read the full text)

While we acknowledge the potential of GOOGL to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than GOOGL and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.