Alphabet's GOOGL Google is gaining ground in the U.S. smartphone market thanks to strong shipment growth of its Pixel 9 devices. According to the latest report from Counterpoint Research, Google's shipments increased 20% year over year in third-quarter 2024 courtesy of the earlier (August) release of the Pixel 9 series compared to the Pixel 8's October 2023 release.
Google's third-quarter shipment growth trailed only Motorola but was way better than Apple AAPL and Samsung, which saw a 2% and 13% decline, respectively. Overall, third-quarter U.S. smartphone shipments declined 4% year over year due to sluggish demand.
Alphabet announced the Pixel 9 series on Aug. 13 and launched the device along with Pixel 9 Pro XL on Aug. 22. Pixel 9 Pro and Pixel 9 Pro Fold were released on Sept. 4. Strong demand for Pixel 9 Pro XL has been a key catalyst as the device made the list of the top 10 premium smartphones sold in the United States.
The early release not only helped Google in smartphone shipment growth but also in grabbing market share. According to the latest StatCounter data, Google Pixel's North American market share increased from 4.76% in September to 12.9% in October (14% when considered the U.S. market only).
GOOGL Pixel Benefits From Innovative AI Features
Alphabet is leveraging AI and Generative AI (Gen AI) to boost Pixel's features. The devices run on Google Tensor G4 chips, which help bring the Gemini Nano with Multimodality, Google's latest on-device AI model. Gemini assistant understands text, as well as images, audio and speech due to the multimodal models.
Google Tensor G4 is custom-built for Gemini and helps users browse the web 20% faster and launch apps 17% faster on average.
AI and Gen AI power Pixel's photography and video capabilities, including Add Me and Plus Magic Editor features. Pixel Studio is a first-of-its-kind image generator powered by an on-device diffusion model running on Tensor G4 and Google's Imagen 3 text-to-image model in the cloud.
Pixel Weather app uses AI to offer more accurate forecasts. Users can create lists in Google Keep with the help of Gemini. Call Assist uses AI to not only screen spam calls but also to wait on hold for users. This feature is now available on Pixel Watch 3.
Alphabet Stock Rides on Strong AI Demand
GOOGL shares have returned 4.1% in the past month, outperforming both the Zacks Computer & Technology sector and the Zacks Internet Services industry. Over the same timeframe, the sector and industry have returned 3.3% and 0.9%, respectively.