: Google’s Bard could ‘blow a hole’ in margins, analyst warns

Could Alphabet Inc.’s foray into artificial intelligence, Bard, “blow a hole” in its margins? It’s a question posed by UBS analyst Lloyd Walmsley posed in a note Thursday. After careful consideration, he expects costs to come subside quickly. “We see cost risk around the integration of generative AI into Google search results as manageable,” Walmsley wrote, in reiterating a buy rating on Google shares. “We see several proof points in recent weeks that costs are coming down rapidly, including the fact that OpenAI stated it had managed to reduce costs for ChatGPT by 90% over December-March.” Google faces increasing pressure from Microsoft Corp. MSFT, whose investment in OpenAI gives it a technological edge, according to several analysts.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.