While there were many preceding events that led to the rise of artificial intelligence (AI), the launch of OpenAI's ChatGPT in November 2022 seemed to really trigger the start of what some are calling the fourth industrial revolution.
ChatGPT took the internet by storm, and consumers were floored by the chatbot's capabilities, including its human-like conversational skills and its ability to generate content and images. ChatGPT caught on like wildfire and quickly became the fastest-growing consumer app of all time. But any product or service as popular as ChatGPT is likely to attract competition.
And that's exactly what happened. Large tech players like Anthropic, Microsoft, Meta Platforms, and Alphabet (GOOG 1.69%)(GOOGL 1.66%) developed their own large language models. Recently, Google's Gemini has made waves in the industry, reporting massive growth. Did Gemini just say "checkmate" to ChatGPT?
Image source: Alphabet.
Comparing Gemini to ChatGPT
Comparing ChatGPT to other AI models launched by hyperscalers can be difficult conceptually because ChatGPT is OpenAI's sole offering and therefore a destination, while hyperscalers like Alphabet have integrated Gemini across the company.
For instance, Gemini powers Google's summaries at the top of most search queries, Google AI Mode, a search feature that allows users to take search one step further by prompting Gemini and following up on answers in a more conversational manner, and the actual Gemini app. The Gemini app is the closest comparison to ChatGPT, offering conversational prompts and the ability to generate various types of content. The latest model, Gemini 3, has also been well received by the market and features a coding tool.
On Alphabet's latest earnings call, the company revealed that the Gemini app now has over 750 million monthly active users (MAUs), up 100 million from the prior quarter. That's also not far from ChatGPT, which is believed to have over 800 million MAUs. Gemini is clearly closing the gap, which means ChatGPT's market share has likely eroded.
Gemini and company will make ChatGPT's life harder
Google is certainly seeing tailwinds from its success with Gemini. While the company does not directly attribute revenue to the model, it is a key driver behind growth in Google's cloud and services units, which both reported strong year-over-year growth. In fact, Alphabet reported over $400 billion in annual revenue in 2025, the first time the company has achieved that number, which is also up 15% year over year.
NASDAQ: GOOGL
Key Data Points
Analysts are largely positive on Alphabet's recent quarter and have upgraded the stock, seeing a clear path to monetization from its AI services. Now, it's a bit difficult to make a totally apples-to-apples comparison between Gemini and ChatGPT. Sure, they are both chatbots, and you can evaluate their models individually, but Google can deploy Gemini across multiple parts of its business and leverage its huge brand recognition to market it.
While ChatGPT has seen no shortage of media attention and publicity, it's pretty incredible that an upstart could so quickly challenge major hyperscalers like Google and really change the playing field. That's nearly unheard of for the hyperscalers, which have gotten so big, are so profitable, and have established such huge moats that most believed were impenetrable.
Where do things stand today? Well, similar to Nvidia, the leader in the chip business, OpenAI has quickly found itself facing significant competition, which threatens to hurt the company's margins and future market share. Not all first disruptors succeed, and there's no guarantee OpenAI will. The company is going to have to raise an extraordinary amount of money to keep up with its AI infrastructure commitments, and is reportedly close to completing a $100 billion funding round, according to CNBC.
Then there could be a massive initial public offering later on. ChatGPT also needs to show continued improvement in future versions of its models and demonstrate that it can grow revenue quickly while maintaining market share. Gemini's recent growth is not "checkmate" for ChatGPT, but along with other competitors, it makes the path forward that much more difficult.
