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June 29, 2022


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Alphabet incurs USD 90 billion in losses due to problems with the Gemini artificial intelligence tool

Alphabet, the parent company of Google, lost about 90 billion dollars of its market capitalization, as the controversy surrounding its artificial intelligence product echoed on Wall Street.

Alphabet shares fell by 4.5% to 138.75 dollars on Monday, closing at its lowest price since January 5, recording its second largest daily loss in 12 months.

The sale followed widespread complaints about Google’s Gemini Gemini services, including an image creation service that produced inaccurate and racist images of historical figures.

Also, the chatbot refused to specify who had the most negative influence in the history between Adolf Hitler and Elon Musk.

The matter was increased by the company’s admission that it “missed the target” when it launched Gemini early and stopped the work of the artificial intelligence photo service over the next few weeks.

Alphabet represented the largest percentage decline among the companies in the S&P 500 index, with a decline of more than 50 billion dollars.
“The problem is not the controversy surrounding the AI tool, it goes beyond this to the reality of the brand,”Milius research analysts Ben ritzes and Nick Munro wrote in a note on Monday to clients.

“Regardless of your point of view, if Google becomes an unreliable source of artificial intelligence, this will negatively reflect on its business,”the analysts continued.

This controversy may shake Google’s well-established position in the world of internet search. In light of the burgeoning role of artificial intelligence in online search, “a significant part of users is increasingly concerned about the hallucination of Google gadgets and the possibility of their bias”.

The obvious bias of the artificial intelligence tool is the latest Alphabet company’s mistakes that cannot be underestimated, especially in light of the frantic artificial intelligence race, on which rival Microsoft seems to be taking the throne.

Alphabet also lost more than 100 billion dollars of its market value on the day of the announcement of the AI-powered automated chat service last February, especially after the press release included actual mistakes made by the service.

Alphabet shares are down 1% since the beginning of the year so far, lagging behind the S&P index gains of 7% and the Nasdaq index, burdened with technology companies, rose by 8%, in addition to the gains of competitors such as Microsoft and meta.

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