Home Technology Google is on a ‘journey,’ but we won’t really know where it...

Google is on a ‘journey,’ but we won’t really know where it leads until fall


The tech giant is embracing artificial intelligence in a transformation aimed at making its searches smarter. But, as second-quarter earnings show, Google’s doing pretty well in the meantime, topping Wall Street expectations.

July 31, 2016: As Google showed off its master plan for a future built around artificial intelligence in May, CEO Sundar Pichai introduced a virtual helper that aims to make its search technology even more useful for you.

It’s a grand plan — in an interview in May, Pichai called it a “broad journey” — but we’ll have to wait a while longer until it comes into focus. Consumers won’t be able to even try out the Google assistant until the fall. That’s when the company will make available the first gadgets to have AI built-in: Google Home, a device like Amazon’s Echo speaker and smart home hub, and Allo, a messaging app.

“We are building the engine that will drive our future,” Pichai said Thursday on a conference call. “We are at a pivotal and transformational moment.”

“There’s an amazing energy right now at Google,” he added.

So for now, Google, organized under its holding company Alphabet, is just talking about Pichai’s vision for tomorrow.

But in the meantime, Google’s doing pretty well. Alphabet gave us a snapshot today. In the second quarter, sales totaled $21.5 billion. Profit, after some costs, was $8.42 a share. Analysts expected $20.76 billion in sales and earnings of $8.03 per share.

Ruth Porat, Alphabet’s CFO, called the results “terrific.” Shares rose 4 percent in after-hours trading.

Google makes the vast majority of its more than $65 billion through digital advertising. But while Google became one of the most powerful companies on the planet after beating out every other company in desktop computer search — and how to tie ads to it — people are now using those computers less and less.

Instead, they are turning to phones or tablets, or beckoning information from their Amazon Echos. Google wants to make sure it’s a leader when people are searching on those devices, too. As of yet, though, Google hasn’t discussed ways to advertise using the Google assistant.
But it doesn’t take advanced machine learning to see where that’s going.

On Thursday, Google also focused on areas outside of search that are growing. Pichai said the company has sold more than 30 million Chromecast streaming devices, up from the 25 million figure Google shared in May. The company also touted its bigger investment in cloud computing and the success of YouTube ads. (Before the call began, Google played wait music by a Norwegian singer called Aurora who gained a following on YouTube. The company then gave her a plug before Pichai and Porat began to speak.)

By Richard Nieva