Alphabet shares started 2025 with investors questioning whether Google could keep up with ChatGPT maker OpenAI in the AI race. By year’s end, the stock had notched its best performance since 2009.
Google got its AI mojo back. Much of that was driven out of DeepMind, the British company Google acquired in 2014 for around £400 million.
In a wide-ranging interview for CNBC’s new podcast, The Tech Download, DeepMind’s founder and CEO Demis Hassabis called it “the engine room” of Google’s AI efforts, adding that changes had been made to enable the tech giant to rapidly roll out AI products amid a “ferocious competitive environment.”
Hassabis said he talks to Google CEO Sundar Pichai “every day,” underscoring how close the two executives are working to innovate quickly.
“All the AI technologies is done by this group … and then it’s diffused across all of these incredible products right across Google,” Hassabis told The Tech Download, which launched on Friday.
“And the last couple of years, we’ve been building that backbone, so not just the models, but also … architecting the entire infrastructure of Google so that … these things can ship incredibly quickly.”
This could be key for Google as it faces another year of competition from OpenAI as well as a plethora of other players from Amazon to Perplexity and Anthropic.
“It’s a ferocious competitive environment at the moment,” Hassabis said. He added “many” veterans who’d been in tech for “20, 30 years,” had told him this was “the most intense environment they’ve ever seen, perhaps ever in the technology industry.”
Alphabet’s stock performance over the last 12 months.
Daily calls with Sundar Pichai
When OpenAI launched ChatGPT in November 2022, Google was playing catch-up. Product missteps with its AI tools along the way, particularly in 2024, reinforced the industry’s impression that Google was struggling to compete.
Hassabis said the company’s issue wasn’t inventing tech. Transformers, a key architecture that underpins large language models, were created by Google researchers after all. The company’s issue was “maybe” that it was “a little bit slow to commercialize it and scale it,” Hassabis continued.
“That’s what OpenAI and others did very well,” he added.
“The last two, three years, I think we’ve had to come back to almost our startup or entrepreneurial roots and be scrappier, be faster, ship things really quickly and sort of make really rapid progress,” Hassabis said.
Google CEO Sundar Pichai addresses the crowd during Google’s annual I/O developers conference in Mountain View, California on May 20, 2025.
Camille Cohen | AFP | Getty Images
The DeepMind CEO said the company “got into our groove” with the launch of Gemini 2.5 in March 2025. In November, Google launched Gemini 3, which was highly praised by tech CEOs and users for its speed.
Hassabis said the Gemini models being developed at DeepMind can be shipped across various Google products, such as search, very quickly.
“For the last sort of year, that’s becoming really a smooth process now, and I think you’ll see that more over the next 12 months,” Hassabis said.
“We think of ourselves and describe ourselves sort of as the engine room for that.”
Hassabis added that he and Pichai “pretty much talk every day about strategic things and where should the technology go, and what does the wider Google need,” underscoring how integral DeepMind is to Google’s wider plans and the pace the company is hoping to innovate.
Hassabis said the conversations with Pichai will lead to potential adjustments of roadmaps and plans “on a daily basis,” still with the longer-term view of achieving artificial general intelligence, an AI deemed as intelligent as humans and the Holy Grail of the industry, “first, fast and safely.”
AI bubble
As tech giants commit hundreds of billions to building AI infrastructure and their shares continue to rise, market participants have debated whether the AI boom is a bubble. At the same time, venture capital money poured into AI startups with many raising funds at high valuations and little product.
Hassabis said some parts of the industry “might be in a bubble” and others probably are not.
“AI is going to be the most transformative technology ever invented,” he said. He compared it to the dot-com bubble of the late 90s and early 2000s. “In the end, the internet was critical, and there were some generational companies that were created during that time,” Hassabis said.
“That’s sort of almost inevitable. There’ll be overexuberance once everyone realizes how transformative a specific technology is. And then there’ll be a reckoning and then the things that are real will survive and flourish.”
CEO of DeepMind Demis Hassabis listens during a debate at an AI summit at Imperial College London, in central London on July 9, 2025.
Ludovic Marin | Afp | Getty Images
Hassabis said that seed funding rounds in private markets valued at tens of billions of dollars where “there’s just almost nothing there yet” in terms of products were “unsustainable over the long run.”
“I’ve got to make sure that whichever way it goes, whether it continues to go all rosy and exponential, like it is now, or there’s … some kind of bubble bursting, that we’re in the right position to win either way, and to take advantage of that either way,” Hassabis said.
“And I think we’ve got a good position, given Google’s underlying business and how AI fits with that, to benefit whichever way it goes from here.”
