Alphabet shares fall on report its Gemini 3.5 Pro AI model is delayed

Alphabet Shares tumbled 4% on Thursday following a report that the company was delaying the launch of its flagship AI model.

The search giant’s Gemini 3.5 Pro AI model is months behind schedule due to the company’s efforts to improve its performance. BloombergQuoting from sources familiar with the subject. In particular, the coding capabilities of the model were below internal expectations and came at a time when competitors liked it. OpenAI And Meta The report noted that Google recently introduced new AI models that surpass its current offerings for generating software code.

The company previously announced the Gemini 3.5 Pro AI model in May as part of the company’s annual Google I/O developer conference, saying at the time that it was being used internally but wouldn’t be ready for wider use until the following month.

A spokesperson for Alphabet said in an emailed statement to CNBC that the company “ships a wide range of models quickly, keeping it extremely affordable for customers.”

“We are currently testing an upgraded Flash model, the 3.5 Pro, and other models with our partners and are working productively with the US government,” the spokesperson said.

Code generation has become one of the biggest use cases for AI model providers anthropic and such as OpenAI and Chinese AI labs za.ai offering open-heavy variants that developers can access for free through the open source ecosystem.

Last week, Meta launched its Muse Spark 1.1 AI model, which the company’s AI chief Alexandr Wang described as the social media giant’s “most powerful model yet for agency and coding work.”

OpenAI last week launched its GPT-5.6 Sol AI model, which CEO Sam Altman said is 54% more coin efficient on agency coding tasks, and highlighted how AI labs are offering their AI coding models cost-effectively based on their performance.