Jefferies Financial Group Inc.: Alphabet Inc. Class C (GOOGL.US) loss of AI talent is just "noise", investment logic remains unchanged, maintaining a target price of $445.

Recently, Jefferies Financial Group Inc. stated that Alphabet Inc. Class C (GOOGL.US) has recently lost several well-known artificial intelligence (AI) researchers, but this is just "noise" and has not changed their investment logic. Jefferies Financial Group Inc. analyst Brent Thill wrote in a report to clients, "Alphabet Inc. Class C is one of the longest-standing companies in AI research in the industry, still boasting the deepest talent pool in the field, with a total of approximately 194,700 employees as of the first quarter of 2026, a 5% increase year-on-year. We believe that the recent wave of departures does not mean that Alphabet Inc. Class C's investment in AI has weakened, but rather reflects the increasingly fierce competition for talent in the industry, with cutting-edge labs actively poaching high-paying employees. In our view, this 'musical chairs' dynamic will be a continuous feature of the current AI cycle, rather than a phenomenon unique to Alphabet Inc. Class C. In addition, the decline in stock prices is also compounded by the broader weakness of the FANG group as a whole - as portfolio managers rebalance positions for recent large-scale IPOs and listings of cutting-edge labs (such as MAGS down 2% year-to-date, while the Nasdaq Composite Index rose 13%), this sector has become a target for fund outflows." Thill has given Alphabet Inc. Class C a "buy" rating with a target price of $445. Earlier this week, Nobel Prize winner John Jumper announced his departure from Google DeepMind to join Anthropic. Before Jumper's departure, Noam Shazeer had also bid farewell to Alphabet Inc. Class C and joined OpenAI. Another Google DeepMind researcher, Lun Wang, resigned in May this year. Thill further noted that compared to leading cutting-edge AI labs, the progress of the Gemini product is "a bit slow," but he believes that Gemini does not have to be the top model to inject strong momentum into the growth flywheel of this tech giant. Thill explained, "With its dominant distribution advantages in the search, cloud services, and Workspace fields (its five applications have 3 billion users), as well as the structural cost advantage brought by TPUs, a competitive Gemini is a successful Gemini in itself." Thill added, "Solid on-the-ground research continues to confirm this judgment, and we remain bullish on Alphabet Inc. Class C. Similar pullbacks triggered by news headlines only create noise, but the underlying logic remains unchanged: the AI business system is still robust, the talent pool is still deep, the current rotation is a tactical adjustment, not a fundamental shift. We expect the stock price of Alphabet Inc. Class C to gradually rise from its current level."