The shares of Google owner Alphabet Inc. fell 2.3 percent late last week following a report that its tech segment fell behind schedule on delivering its most powerful flagship AI model, the Gemini 3.5 Pro.
Bloomberg reported that the delay stemmed from Google taking additional time to improve the model’s capabilities, particularly in coding. Bloomberg quoted close sources as revealing that the setback had frustrated Google engineers, AI researchers and managers, with many expressing concerns that the company risks losing market position as rivals Anthropic and OpenAI produce models that exceed Gemini’s capabilities.
Both OpenAI and Meta Platforms recently released new models that outpace Google’s current offerings in AI for writing code. Google late last month updated the data being used to train Gemini to improve these skills, but the results were disappointing, according to the report.
A Google spokesperson said the company was shipping quickly across a wide range of models while keeping them cost-effective for customers. According to the spokesperson, Google is currently testing 3.5 Pro, an upgraded Flash model, and other models with partners, and is engaged with the US government on model testing and broader frameworks.
The report noted that Google’s structure, with multiple layers of stakeholders involved in preparing models for release and working to integrate AI across a vast product portfolio including search, maps and YouTube, can cause delays. Google has also been in talks with the US government, which has been increasingly monitoring AI companies’ most advanced models, about its capabilities and industry safety standards.
