Alphabet Inc., the parent company of Google, saw its shares surge nearly 4% on Thursday, marking a two-day upward streak and pushing the stock to levels not seen in almost three months. The rally follows a wave of investor enthusiasm sparked by new artificial intelligence initiatives unveiled at the company’s recent developer conference.
One of the key highlights was the official rollout of “AI Mode” within Google Search, now available to users across the United States. The move signals a broader integration of generative AI into the company’s flagship services and has been viewed as a strategic step toward reinforcing its dominance in the online search space.
In addition to the AI Mode expansion, Alphabet introduced a premium subscription plan priced at $249.99 per month, targeting power users of its AI tools. Analysts believe this offering will help offset the substantial costs of ongoing AI research and development. According to Citi’s Ronald Josey, the developments reinforce confidence in Alphabet’s ability to maintain growth in search while simultaneously scaling up monetization strategies.
During the event, CEO Sundar Pichai addressed concerns about the potential shift in user behavior, where consumers might prefer AI-driven chat interfaces over traditional search engines. Pichai emphasized that generative AI is enhancing—not replacing—the core search experience.
Google’s search leadership also hinted that leveraging AI to tackle more complex queries could unlock new, more effective advertising formats. Since ad revenue remains Alphabet’s primary income source, integrating smarter AI responses with relevant ads is expected to open additional monetization channels.
With analysts forecasting further monetization of AI Mode following its U.S. debut, investor sentiment has turned increasingly optimistic. Alphabet’s Class C shares closed at $175.27, representing a solid rebound despite the stock being down roughly 7% year-to-date.
