In a significant restructuring of its artificial intelligence (AI) divisions, Google has announced that chief scientist Jeff Dean will be departing after a remarkable 27-year tenure with the company. As per a memo from CEO Sundar Pichai shared on Google's blog, Demis Hassabis, CEO of Google DeepMind, is stepping into a new role as chairman of that division and will also take on responsibilities as chief scientist for the parent company, Alphabet. Following this news, Alphabet's stock saw a decline of approximately 4%.
Dean, renowned for his contributions to AI development and credited with numerous key innovations at Google, is set to launch a new startup alongside Sanjay Ghemawat, a senior fellow at Google. The transition is amicable, and Google has committed to supporting Dean's venture with an investment.
Pichai expressed enthusiasm about Dean's new journey, emphasizing that after such a long and impactful career, now is the right time for Dean to explore new opportunities. He noted that both Dean and Ghemawat aim to "accelerate discoveries" within the realms of machine learning, science, and engineering. This leadership adjustment includes the promotion of DeepMind’s tech head Koray Kavukcuoglu to lead Google's AI division. This move aligns with Google’s strategy as it strives to maintain its competitiveness in an evolving AI landscape against players like OpenAI and Anthropic, while also investing heavily in infrastructure to support its cloud services.
In the most recent quarter, the company reported negative cash flow for the first time due to its significant capital expenditures, anticipating full-year capital expenditures of up to $205 billion. Kavukcuoglu is tasked with spearheading the development of Gemini 4, Google's upcoming flagship AI model, and he will report directly to Pichai.
Demis Hassabis, who co-founded DeepMind and became part of Google following its acquisition of the lab in 2014, has been instrumental in leading Alphabet's core AI initiatives. He mentioned in a message to staff that it's an opportune moment for him to transition from day-to-day operations at Google DeepMind, allowing him to focus more on higher-level strategic visions for AI alongside Pichai.
In a recent update via X, Dean shared that his new venture will be named Discovery Loop and will operate as a public benefit corporation aimed at advancing AI in the fields of science and engineering. While the restructuring occurs, Google continues to exhibit strong growth within its AI sector. Its cloud division, managed by Thomas Kurian, is experiencing rapid expansion, outpacing larger competitors like Amazon Web Services (AWS) and Microsoft Azure. In the second quarter alone, Google's cloud revenue surged by 82%, reaching $24.8 billion, while AWS and Azure reported revenue growths of 37% and 43%, respectively.
Pichai highlighted in a recent earnings call that the expansion is being driven by AI infrastructure and solutions, noting increased demand for Google's proprietary tensor processing units (TPUs). This news follows Google's announcement of three new Gemini models, representing its direct response to Anthropic’s advancements in cybersecurity. However, the company is still awaiting the release of Gemini 3.5 Pro, which has faced delays. Pichai concluded that the rising demand for their AI models reflects robust token usage among both developers and enterprise clients, indicating a strong momentum for rapid adoption, although supply constraints persist.
