Gene Munster Analyses Google And Microsoft's Approach To AI During Earnings Call: 'Drinking Tea' Vs. 'Red Bull'

Gene Munster, managing partner at Deepwater Asset Management, has compared how Alphabet Inc GOOG GOOGL and Microsoft Corp MSFT played the AI theme during their earnings call.

What Happened: Both tech giants reported better-than-expected results on Tuesday. While Microsoft reported a 7% year-over-year increase in its third-quarter revenue at $52.9 billion, Alphabet's first-quarter revenue rose 3% year-over-year to $69.79 billion.

Also Read: Everything You Need to Know About Google Stock

Munster said in his tweet that when the topic of AI came up, "it feels like Google management is drinking tea and Microsoft Red Bull."

Pichai's Take: Alphabet CEO Sundar Pichai said during the earnings call that the company will continue to incorporate generative AI advances to make ‘Search' better in a thoughtful and deliberate way.

"We'll be guided by data and years of experience about what people want and our high standards for quality," he said, according to a transcript of the earnings call published on Seeking Alpha.

Interestingly, Ruth Porat, Chief Financial Officer at Alphabet, said that total capital expenditure for 2023 will be modestly higher than in 2022 and added that AI is a key component.

"It underlies everything that we do, and we're continuing to invest in support of AI, support of our users, advertisers and our Cloud customers, since we are commenting on here," she said during the earnings call.

"Google's AI tone is optimistic, measured, put the customer first, do it right, and light on details besides AI search," Munster tweeted, while adding that Microsoft is talking up about how much they’re integrating AI into many products in the near term.

Nadella's View: Microsoft CEO Satya Nadella highlighted the company's progress with respect to AI. "We have the most powerful AI infrastructure and it's being used by our partner, OpenAI, as well as NVIDIA and leading AI start-ups like Adept and Inflection to train large models," he said, according to a transcript of the earnings call published on Seeking Alpha.

Nadella noted that the company is bringing next-generation AI to Power Platform so that anyone can automate workflows, create apps or web pages, build virtual agents and analyze data using only natural language.

The Microsoft CEO also spoke in depth about how AI is contributing to different functions like security, LinkedIn, gaming etc.

"In a few weeks time, we’ll hold our Build conference, and we will share how we are building the most powerful AI platform for developers and I encourage you to tune in. I could not be more energized about the opportunities ahead," he added.

Read Next: Yellen Warns Of Economic Catastrophe If Congress Fails To Raise Debt Ceiling: ‘Default Would Raise Cost Of Borrowing Into Perpetuity’