How Generative AI Contributed to Big Tech’s Quarterly Earnings Report: The Latest Key Facts and Figures
If you do not know already, generative AI is a branch of artificial intelligence that can create new content, such as text, images, audio, and video, based on existing data and models. It has been the focus of investment for various tech companies as they try and wrangle a larger share of the industry by incorporating the new technology into their products and services. The question is, is it paying off? It appears it is!`
In this article, we will look at how generative AI has contributed to the impressive quarterly earnings report of some of the biggest tech companies in the world.
Some of the Q3 Results
- Microsoft: Azure and AI boost cloud growth. Microsoft reported a 13% year-on-year increase in revenue to $56.5 billion, beating analysts’ expectations. The company’s cloud business, Azure, grew by 35%, driven by strong demand for cloud computing and AI services. Microsoft also highlighted its investments in generative AI, such as GPT-4, a powerful text and image generator that can create realistic content on demand.
- Google: YouTube and Google Photos shine with generative AI. Google’s parent company, Alphabet, posted an 11% year-on-year rise in revenue to $76.69 billion, also surpassing analysts’ estimates. The company’s advertising business generated $59.6 billion in revenue, up from $54.5 billion in the prior year. YouTube ads accounted for $7.9 billion of that revenue, up 12% year-over-year. YouTube also saw a surge in user engagement with its YouTube Shorts feature, a TikTok competitor that uses generative AI to create short videos. Google Photos, another product that leverages generative AI to enhance and organize photos, also announced a new feature that can generate personalized collages and animations.
- Snap: Generative AI fuels user growth and innovation. Snap, the parent company of Snapchat, reported a 5% year-on-year increase in revenue to nearly $1.2 billion, ahead of analysts’ projections. The company also reported a net loss of $368 million, which was lower than expected. Snap attributed its revenue growth to its strong user base, which reached 306 million daily active users in the quarter, up 23% year-over-year. Snap also credited its generative AI capabilities, such as Snap Camera, a desktop app that can apply filters and effects to video calls, and Snap ML, a platform that allows developers to create custom lenses using machine learning.
Nvidia’s revenue is strongly influenced by the increased demand for adequate processing power to implement generative AI, such as large language models (LLMs). Unfortunately, we do not have their latest results available as of yet but it is expected to be an improvement on their Q2 results which saw the company record all-time high revenue at $13.51 billion.
What Does This Mean?
Generative AI is clearly a key factor behind the success of Big Tech companies in the last quarter. It has enabled them to create innovative products and services that attract and retain users, as well as to generate new sources of income and growth. As generative AI becomes more advanced and accessible, we can expect to see more applications and impacts of this technology in the tech sector and beyond.
As a result, suppliers such as Nvidia or even AMD who are considered 2nd in the race to provide capable processors, may benefit from growing demand as the tech industry pivots their attention to generative AI.
To find out more about the latest in generative AI and technology or just view some AI-generated art, check out our website.
