Google's Gemini 3 is finally here. Can it power Alphabet's stock even higher?

By Christine Ji

Analysts are optimistic that Gemini 3 will accelerate Google's user adoption and revenue growth, proving the company's ability to monetize its AI investments

The Gemini app now boasts over 650 million users per month, while AI Overviews in Search have reached 2 billion monthly users.

Artificial-intelligence competition just got even more heated, as Google launched its much awaited Gemini 3 model on Tuesday.

In a company blog post, Alphabet Inc. (GOOGL) (GOOG) Chief Executive Sundar Pichai announced that Gemini 3 provides "state-of-the-art reasoning and multimodal capabilities," meaning that the model can solve difficult problems and process information from varied sources such as text, video and video simultaneously.

The company also released Google Antigravity, a new agentic development platform for software engineers, and introduced Gemini Deep Think, an enhanced reasoning model that will become available to premium users.

The rollout is being deployed across the entire Google ecosystem including the Gemini app, AI mode in Search, and enterprise products.

Gemini 3 "significantly outperforms 2.5 Pro on every major AI benchmark," Pichai said, referring to the previous Gemini model that was released in March of this year. Additionally, Google said that Gemini 3 outperformed rivals ChatGPT 5.1 and Claude Sonnet 4.5 in several key areas such as complex academic and scientific reasoning, novel mathematical problem-solving, and agentic tasks involving screen and video understanding.

Last week, OpenAI announced an upgrade with ChatGPT 5.1, which introduced "Instant" and "Thinking" variants along with new personality modes to make the chatbot smarter and more conversational.

OpenAI CEO Sam Altman even offered his kudos following the Gemini 3 release.

Also read: Why it's not too late to buy Alphabet's stock, according to the newest Google bull

Google's Gemini 3 launch has been highly anticipated among Wall Street analysts, who are watching to see if the new model spurs increased Gemini adoption and continues to boost Google's AI momentum, especially as the company increases its spending on AI infrastructure.

Evercore ISI analyst Mark Mahaney called Gemini 3 "another example of leading innovation" in a Tuesday note. "What Google has proven and continues to prove with the release of Gemini 3 is that the company is an innovation engine capable of shipping impressive, high-quality products that lead to additional monetization opportunities."

Mahaney pointed out that despite the stock's more than 50% appreciation this year to date, Alphabet shares still trade at a what he views to be an attractive forward price-to-earnings multiple of 26.

While Google's stock faced challenges earlier this year over concerns about ChatGPT eroding the Search business, the company has proven the bears wrong thus far. Last quarter's Search revenue grew 14.5% thanks in part to AI Overviews and AI Mode, and Google's Gemini has seen a surge in popularity in 2025.

Google's Search, YouTube, Android, Cloud and other business segments give the company a strategic advantage when it comes to distributing its AI products, Needham analyst Laura Martin wrote in a note on Tuesday, before the Gemini release. She said the company is best positioned among peers to capture return on its AI investments.

After today's update, Gemini has a 92% implied probability of becoming the top large language model by the end of the year, according to Polymarket. According to Google, the Gemini app has over 650 million monthly active users, while AI Overviews has over 2 billion. In comparison, ChatGPT recently hit 800 million weekly active users.

Read on: Alphabet's stock gets a Buffett bump. Here's the next big Google catalyst.

-Christine Ji

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11-18-25 1420ET