Alphabet, the parent company of Google, announced Friday that it is eliminating 12,000 jobs. It becomes 6% of its workforce, as the technology industry struggles with layoffs and businesses gamble their futures on artificial intelligence (AI).
When Alphabet quickly increased personnel, Pichai claimed he took “full responsibility” for the company’s decisions since it faced “a different economic reality” from the previous two years.
The U.S. corporation, which has long been a pioneer in important fields of AI research, is in a precarious position as a result of the downsizing.
Microsoft is now competing with Alphabet in a field of technology that, for example, can produce almost any form of material that a user may conjure up and type into a text box.
Pichai was named CEO of Alphabet in 2019. Shares of Alphabet increased by about 3% in pre-market trading.
The company has “a substantial opportunity in front of us with AI across our products,” he continued, adding Google is preparing “to provide some whole new experiences for consumers, developers, and enterprises.”
According to two people with knowledge of the situation who spoke to Reuters, the business has been working on a significant AI rollout. It would happen, according to one of the sources, in the spring of this year.
According to Susannah Streeter of Hargreaves Lansdown, Alphabet’s advertising division, which powers YouTube and Google’s search engine, is not immune to economic uncertainty.
In stark contrast to the hectic times of the post-pandemic re-opening, which witnessed a spike in consumer spending, she added, “ad growth has cooled off the boil.” She added that the business also confronts dangers from regulations and competition.
If Alphabet will incur a one-time financial charge because of the employment losses, it was not apparent. Microsoft announced earlier this week that its severance benefits, lease consolidation, and adjustments to its product lineup would cost it more than $1 billion.