Alphabet Inc. (GOOGLE) stocks soar around 6% to a record high on Monday, November 24.
The increase was fuelled by a potent mix of bullishness around its new artificial intelligence model and a major vote of confidence from legendary investor Warren Buffett.
One of the major drivers behind the rally is the newly launched Gemini 3, Alphanet’s most advanced AI model to date.
CEO Sundar Pichai touted its superior reasoning capabilities and its ability to comprehend nuances requests with less user prompting.
The model, which now boasts 650 million monthly users, is gaining market share in the competitive AI chatbot space.
Another prominent factor is Buffet's Berkshire Hathaway acquiring a massive new position in Alphabet, purchasing 17.8 million shares valued at $4.3 billion.
This landmark investment marks the first time Berkshire has bought Alphabet stock.
These recent developments have positioned Alphabet as a standout performer. While most “magnificent seven” stocks have struggled, Alphabet has delivered a remarkable 22% return over the past month.
Market analysts attribute this outperformance to its strong earnings momentum and a relatively low valuation in comparison to its peers, with a price-to-earnings ratio of 29.
The company’s success also extends to its AI hardware. As unveiled in the recent reports, Meta Platform is in talks to spend billions on Google’s custom Tensor Processing Units (TPUs) indicating that Alphabet is becoming a formidable competitor to Nvidia in the AI chip market.
This follows a major deal to supply AI startup Anthropic with up to one million TPUs, further confirming its vertically integrated AI strategy.
Resultantly, Alphabet not only propelled its own valuation but also led to a broad market upswing, with the Nasdaq Composite jumping to 2.7%.