Why AI Poses 'a Real Risk' to Google's Search Revenue -- Barrons.com

Dow Jones2023-03-31

By Emily Dattilo

Piper Sandler says that while Google may have a "fortress-like market share," artificial intelligence is weighing on the internet company.

Analyst Thomas Champion lowered his price target on Alphabet (ticker: GOOGL) to $117 from $120 in a report Friday, calling AI "a real risk to Google Search revenues." Informational searches will be most affected, he said.

Shares were up 0.7% to $102.106. The stock has gained about 15% so far this year.

In the past, Google has led the charge in AI, but lately, it hasn't seemed to be keeping stride with Microsoft $(MSFT)$, Champion said. "That said, perception may not match reality," he added.

The analyst reiterated an Overweight rating on the stock, saying that he believes "risk is already reflected in the multiple."

Earlier this week, a letter by Elon Musk and a group of AI researchers asked companies to hit pause on developing more powerful AI systems.

Write to Emily Dattilo at emily.dattilo@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

March 31, 2023 10:15 ET (14:15 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.

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