OpenAI's ChatGPT is still the king of generative AI, but the crown is getting a little loose. According to a new BNP Paribas research report released Monday, rivals like Alphabet Inc.'s (Alphabet (GOOGL)) Google Gemini and Anthropic's Claude are steadily nibbling away at its market share.
Analyst Nick Jones noted that BNP Paribas' AI tracker showed Gemini's share of visits rose to 29.9% in May from 29.4% in April, while its average monthly daily active user share climbed to 18.9% from 17.9%. Claude also made gains, with visits jumping to 9.8% from 8.8% and average monthly daily active user share increasing to 2.9% from 2.5%. ChatGPT remains dominant, Jones said, but it continued to lose share during the month.
This shift comes as Alphabet inks a big deal with SpaceX to secure 200 megawatts of compute capacity for about $920 million per month. Jones acknowledged that might raise near-term capital intensity concerns, but he views the investment as strategically prudent. The rationale? Strong cloud backlog growth, accelerating AI adoption, and long-term revenue opportunities across Search, Cloud, and AI-driven products.
Interestingly, Jones thinks the structure and economics of the SpaceX agreement could also push Meta Platforms Inc. (Meta (META)) to accelerate plans to commercialize its infrastructure through a cloud offering. So the ripple effects could be bigger than just Alphabet's balance sheet.
On the enterprise side, Jones highlighted that Claude generated about 80% of the code merged into Anthropic's product codebase in May. That's a concrete sign that AI models can meaningfully improve developer productivity, which should support higher enterprise AI spending over time. And for those worried about robots taking jobs, Apollo's chief economist said he's seen no evidence of AI-related job losses to date. Jones noted that supports the view that AI is currently augmenting worker productivity rather than causing broad labor displacement.
Looking further out, SpaceX's plans to deploy orbital AI compute satellites as early as 2028—with a long-term goal of launching up to 100 gigawatts of compute capacity into orbit annually—underscore just how massive the expected AI compute demand is. It also shows the industry's willingness to explore alternative infrastructure, even if it involves rockets.
As for Alphabet's stock, shares were down 0.16% at $362.74 at the time of publication on Tuesday.
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