Google has introduced its newest AI software, Gemini 3, reinforcing the company’s position in the race against Chatgpt's OpenAI and other major competitors.

According to Bloomberg, the model has drawn early praise for its improvements in reasoning, coding, and handling complex or niche tasks that often challenge AI chatbots.

The roll-out comes as Google Cloud once seen as a distant third in the industry continues to grow steadily, powered by rising global demand for AI infrastructure and compute capacity.

The shift is also reshaping market sentiment. Reports that Meta may adopt Google’s AI chips helped fuel a rally in parent company Alphabet’s stock. Since mid-October, Alphabet has added hundreds of billions of dollars in market value, supported by strong investor enthusiasm around its AI prospects and high-profile backing, including Warren Buffett’s recent multi-billion-dollar investment.

Alphabet shares rose 1.5 percent in New York trading on Tuesday, putting the company on the cusp of a multi-trillion-dollar valuation.

The competitive reaction was sharp. SoftBank Group, a major OpenAI investor, slid around 10 percent amid concerns that Google is gaining ground. Nvidia, a dominant supplier of AI chips, also dipped more than two percent, erasing over 100 billion dollars in market capitalization in a single session.

“Google has arguably always been the dark horse in this AI race,” said Neil Shah, analyst and co-founder at Counterpoint Research. “A sleeping giant that is now fully awake.”

For years, Google insisted that deep, expensive research would secure its lead in search and shape the future of computing. That confidence was shaken when ChatGPT launched, revealing a serious and public threat to Google’s core business even though much of the underlying technology originated at Google.

Still, analysts note that the company maintains several decisive advantages: a massive reservoir of data to improve its models, a highly profitable business capable of funding long-term innovation and World-class computing infrastructure purpose built for AI.