Talent loss, model lagging, commercialization under pressure! Gemini users surpass 1 billion, but Google's "internal and external troubles" cannot be concealed

According to the Zhitong Finance APP, as competition among global leading chatbot providers continues to heat up, Google (GOOGL.US) CEO Sundar Pichai revealed that the company's Gemini application has now surpassed 1 billion users. Pichai posted on social media on Tuesday, stating, "Currently, over 1 billion people use the Gemini app each month to spark new ideas and get work done. This is our fastest-growing product to date and our 14th product to surpass the 1 billion user milestone."

Pichai added, "Kudos to Josh Woodward and the entire Gemini team, and thanks to everyone who has been with us along the way—there's more exciting content to come!" Woodward is the Vice President at Google, responsible for leading Google Labs, the Gemini application, and AI Studio.

Competitors Continue to Ramp Up

The surpassing of 1 billion users for the Gemini application is undoubtedly exciting news for Google, but the company still faces multiple challenges in the artificial intelligence (AI) field. First are the external challenges. OpenAI announced on July 31 that its AI model currently reaches over 1 billion active users, with 2 million enterprise users. To improve its commercialization process, OpenAI has expanded its ChatGPT advertising business. On Tuesday, the company led by Sam Altman revealed that it has launched ChatGPT Ads in the UK, Mexico, Brazil, Japan, and South Korea. OpenAI began testing ChatGPT ads in the US in February, and by March, the business had expanded to Canada, Australia, and New Zealand.

OpenAI stated, "Maintaining the fast and reliable operation of the Free and Go plans requires significant infrastructure and ongoing investment. Advertising helps fund this work, supports broader AI usage by providing higher quality free and low-cost options, and allows us to continuously enhance the intelligence and capabilities we offer. If you prefer not to see ads, you can upgrade to the Plus or Pro plans, or choose to turn off ads in the Free plan, but the number of free messages available daily will be reduced accordingly." OpenAI stated that ads will not affect the output results provided by ChatGPT.

Although Grok, under SpaceXAI, is significantly lagging behind Gemini, ChatGPT, and Anthropic's Claude in market share, it still has a loyal user base and continues to roll out regular updates and new features. On Tuesday, SpaceXAI launched Grok Bot, which functions like a team of multiple "always-on" intelligent agents that can work across different applications and tools.

SpaceXAI stated, "We initially built Grok Bot as an internal prototype, and it quickly grew throughout the company. Teams created Bots to handle sales outreach, marketing campaigns, office operations, bug fixes, and other tasks. Today, we are excited to open it up to users worldwide." The product is available in beta form starting that day for SuperGrok Heavy, Cursor Ultra, and Cursor Teams Premium subscribers on Apple's iOS system The company stated: "Employees within SpaceXAI typically run multiple Bots simultaneously, with one responsible for managing the other Bots. At the top is a 'Chief of Staff', with a specialized agent assigned to each work area—such as inbox management, expense management, recruitment, bug fixing, or operations. You no longer need to manage multiple intelligent agents; the Grok Bot will provide you with a lean team that can work in parallel, so you no longer have to act as an intermediary."

Google May Have Paused the Release of the Gemini 3.5 Pro AI Model

In addition to external challenges, signals coming from within Google have also caused some market participants to feel uneasy.

According to a recent report by industry analysis firm Semi Analysis, Google may have paused the Gemini 3.5 Pro model internally. At the 2026 I/O Developer Conference held in May this year, Sundar Pichai stated that the Gemini 3.5 Pro model would be launched in June, but the model has yet to go live.

Originally, the Gemini 3.5 Pro model was supposed to take on the task of helping Google re-establish its position at the forefront of AI competition. After all, in the context of OpenAI and Anthropic continuously enhancing their model capabilities, the Gemini Pro series has been an important benchmark for assessing Google's AI strength.

There is speculation that the actual capabilities of the Gemini 3.5 Pro model may not have met Google's initial expectations. Semi Analysis believes that the capabilities of Gemini 3.5 Pro are roughly comparable to those of Anthropic Claude Opus 4.5, which is a model released at the end of November last year.

As a transitional solution, Google has launched more Flash models, including 3.6 Flash, 3.5 Flash-Lite, and 3.5 Flash Cyber. However, from the current public evaluations, the Gemini Flash series emphasizes speed, cost, and deployment efficiency more, and still lags behind Muse Spark 1.2, Grok 4.5, and leading industry open-source models in complex reasoning, programming, and agent tasks.

During Google's Q2 2026 earnings call, Pichai reiterated, "I am very excited about our progress in the frontier areas," and expressed confidence in "maintaining the leading position of the Gemini model."

However, Semi Analysis pointed out that Gemini has clearly fallen behind the leading models. According to the Artificial Analysis Intelligence Index, Gemini currently ranks 8th in laboratory rankings, trailing behind Muse Spark 1.2, Grok 4.5, and top models from Chinese open-source labs.

Top Talent Leaving in Droves

Earlier this month, Chief Scientist Jeff Dean announced his departure after 27 years of service. Several well-known researchers have already left Google, including Noam Shazeer, one of the authors of the landmark 2017 paper "Attention Is All You Need"—a paper that laid the foundation for generative AI, and now all eight authors have left Google Shahzal joined OpenAI in June this year, less than two years after Google recalled him for nearly $3 billion through "acquisition-style hiring." Shortly after his departure, Nobel Prize winner John Jiangpo also left DeepMind to join Anthropic.

D.A. Davidson analyst Gil Luria pointed out the obvious trend of top talent flowing out of Google. He stated, "They are not keen on commercializing AI; rather, they want to be part of history. Therefore, they see Anthropic, OpenAI, or other startups as places where they can write history."

Google's investment in global data centers, chips, and related infrastructure is unmatched, yet there is still a shortage of computing power. Every TPU allocated for training models, supporting Google products, or fulfilling cloud customer contracts represents a choice among multiple priorities. According to several unnamed insiders, some Google researchers are increasingly dissatisfied with the acquisition of computing power—they find it difficult to obtain the computational resources needed to advance cutting-edge projects while seeing Google sell its self-developed TPUs to external clients, including Anthropic. Additionally, the internal approval process at Google is cumbersome, and transforming research results into products requires multiple approvals, making OpenAI, Anthropic, and even younger startups more attractive to AI researchers—they prefer lab work over financial report numbers.

Major Reshuffle in AI Leadership

According to previous reports, there has been a large-scale adjustment in Google's AI leadership. DeepMind co-founder Demis Hassabis has handed over daily management responsibilities and stepped down as the overall head of Gemini commercialization, taking on the roles of DeepMind chairman and Google's chief scientist, focusing mainly on long-term AI research. Former DeepMind CTO Koray Kavukcuoglu has been promoted to Senior Vice President of DeepMind (DeepMind will no longer have an independent CEO), responsible for the development and operation of the Gemini model, reporting directly to Pichai.

Additionally, Google co-founder Sergey Brin will be more directly involved in Gemini. Currently, Brin does not hold an official executive position. However, since the release of ChatGPT, he has re-engaged in Google's daily AI affairs, participating in model testing, discussing technical routes, and exerting increasing influence on the development direction of Gemini.

The core of this reorganization is to move the AI decision-making center back from London to Silicon Valley, aiming to reverse a trend that has plagued the company since at least 2023. That year, Google merged two originally independent and highly regarded scientific laboratories: one based at the company's Mountain View headquarters, Google Brain, and the other rooted in London, DeepMind. Although the two labs merged under the name Google DeepMind, researchers still worked on different continents. According to insiders, this arrangement complicated the decision-making process and left talent in both locations feeling dissatisfied.

A major focus of Google's future business strategy is to transform the "research federation" that was previously scattered between London DeepMind and California Google Brain's traditional system into a Gemini product delivery machine centered in Mountain View and directly accountable to Pichai Kavukcuoglu simultaneously overseeing the daily operations of Google DeepMind and serving as Chief AI Architect means that model pre-training, post-training, evaluation, computing power scheduling, and collaboration with Cloud, Search, and developer products will be incorporated into a shorter decision-making chain.

These latest personnel adjustments and movements do not weaken fundamental research but rather aim to split the management of "long-term scientific exploration" and "quarterly product delivery," attempting to address the issues of slow decision-making among cross-continental teams and the sluggish commercialization of research results following the merger in 2023.

The Gemini 3 series models and Nano Banana image editing tool have helped Google regain market attention. Google has also proven that it still possesses the capability to develop cutting-edge models.

However, the more challenging task at hand is to rapidly convert model capabilities into developer tools, enterprise services, and stable revenue. In the AI programming and enterprise market, OpenAI and Anthropic have already established a first-mover advantage. Google's senior management and board are concerned that the company's research strength has not yet fully translated into product competitiveness.

Previously, Gemini simultaneously undertook multiple functions including research, modeling, application, and security. The longer decision chain made it easy for research objectives and product rhythms to conflict. The new management structure assigns the daily development of Gemini to Kavukcuoglu, which helps shorten the decision-making cycle and accelerate model releases and product implementations.

Reports also mention that some Google executives are dissatisfied with Demis Hassabis's level of involvement in commercialization efforts. AlphaFold is seen as one of the controversial cases. This protein structure prediction system helped Hassabis win the 2024 Nobel Prize in Chemistry and has had a significant impact on scientific research, but after the project was made freely available, Google did not receive commercial returns that matched the scale of its investment. Sources close to Google deny any significant conflict between the two parties. They point out that Hassabis led the early release of Gemini and has been concerned about the project's progress.

After significant changes in Google's AI leadership, whether the new structure will be effective depends on whether the three routes can work smoothly together. Research needs to retain exploratory space, the modeling team needs to increase iteration speed, and the product department must find users who are genuinely willing to pay. For Google, top papers and model rankings are no longer sufficient to dispel external doubts; the upcoming competition will focus on code tools, enterprise markets, product experiences, and commercial revenue.

Sergey Brin's return to the AI power center indicates that Google views Gemini as a core battle that requires the founders' personal involvement. Hassabis stepping back to a research-focused role also signifies a change in the research-led model that DeepMind has developed over the past decade. Google possesses models, computing power, data, distribution channels, and a large enterprise customer base. Now, it needs to prove that it can compress these resources into a faster product pipeline