Alphabet AI Event Will Show Whether Blowout Results Were a Fluke

Alphabet Inc.’s recent results raised hopes that the Google parent can still be a big player in artificial intelligence. Now it has a chance to prove it.

Investors are hotly anticipating the company’s Google I/O annual developers conference Tuesday, where it’s expected to unveil AI features for its search business and broader ecosystem. Bank of America wrote that the event “could help solidify the case for Google (and the Android ecosystem) as a net AI beneficiary.”

The event comes a day after a similar one from OpenAI, where it launched a faster and cheaper version of its ChatGPT model. Some high-profile disappointments have raised lingering questions about Alphabet’s ability to compete against Microsoft Corp.-backed OpenAI despite years of heavy investments.

“Alphabet is in a unique position to show it is making progress, that it can re-right the AI ship, that things aren’t as dire as people thought,” said David Mazza, chief executive officer at Roundhill Investments. “The results are more than enough to support the stock in the near term, but the event offers an opportunity for an upside surprise, and if it can show off, what better time?”

Shares dipped 0.1% on Tuesday.