Google's flagship AI model Gemini 3.5 Pro is months behind its promised June launch date as the company works to improve coding capabilities, raising concerns about competition from OpenAI and Anthropic. Alphabet's stock has declined 15% from its 2026 peak. However, strong Q1 results show Google Cloud revenue grew 63% year-over-year and the cloud backlog nearly doubled to $460 billion, suggesting customer demand remains healthy despite the delay.
Axe note: A late AI launch dents Alphabet’s stock, but strong cloud growth keeps the story alive.