Proactive Investors - Google’s decision to cut hundreds of augmented reality (AR) hardware and voice assistant jobs could be part of a restructuring in favor of additional AI efforts, according to analysts at Wedbush.
“Multiple news sources are reporting Google is cutting employees across a variety of areas in large part to enable higher spending levels around AI,” the analysts wrote.
Exact details of the numbers involved were not released by the search engine giant, but the reports indicated that "a few hundred" had gone in each division.
Alphabet (NASDAQ:GOOGL) Inc (NASDAQ:GOOG)-owned Google has experienced limited success with its developments of AR 'smart glasses' and is said to be looking to partner with a hardware group while it develops the operating system software.
The specific cuts are a bit of a head-scratcher, Wedbush argued.
“We are not surprised Google is allocating more resources to its AI efforts,” the analysts wrote. “What is a bit harder to understand is Google's cuts coming in areas like AR/VR and voice recognition, with those technologies being areas where we are generally encountering incrementally higher levels of hardware/software investment entering 2024.”
Shares of Alphabet fell 0.5% Thursday afternoon to $143.04.