Alphabet, Google’s parent company, has announced a significant overhaul of its artificial intelligence division, seeing AI chief Demis Hassabis step back from his primary managerial role and several key leaders of its Gemini model, including veteran engineer Jeff Dean, depart the company.

The news sent Alphabet shares down 4%.

The shakeup arrives at a critical moment for Google DeepMind. Its flagship Gemini model remains unreleased despite an anticipated June launch, fueling concerns among investors and industry observers that Google is losing ground to rivals like Anthropic and OpenAI, both of whom recently recruited prominent Google AI talent.

Demis Hassabis, a Nobel Prize recipient, will transition from Google DeepMind CEO to its chairman, taking on the newly created title of Alphabet’s chief scientist. In a memo to staff, he cited the imminent arrival of artificial general intelligence (AGI) – an advanced state of AI where computers achieve human-level intelligence – as the driving force behind his role change.

Alphabet chief Sundar Pichai echoed this sentiment in a separate company-wide memo, stating: "He and I have been long discussing a role that allows him to put his full attention on actively shaping the future of AGI. It’s work that is vitally important to Alphabet and humanity, and I can’t imagine a better person than Demis to do it."

Koray Kavukcuoglu, the unit’s chief technology officer, will assume day-to-day responsibilities as senior vice president of the business unit, in addition to his role as Alphabet's chief AI architect.

Meanwhile, some of Google’s most celebrated AI and engineering leaders – Jeff Dean, Sanjay Ghemawat, Oriol Vinyals, and Quoc Le – have left to launch a startup named Discovery Loop.

This new venture, structured as a public benefit corporation, will focus on researching breakthroughs in machine learning, science, and engineering. Alphabet did not offer details on what prompted these departures or their coincident timing.

Hassabis, known for prioritizing research over profits, will now concentrate on research and strategy concerning the societal impacts of AGI, with fewer direct reports, a Google spokesperson confirmed.

In his memo, he highlighted "great progress" on Google's AI models, including an unreleased upgrade called Gemini 4. He also indicated he would dedicate more time to Isomorphic Labs, a drug discovery company he founded and leads, which spun out of DeepMind.

"I’ve always believed the No.1 application of AI should be to improve human health," he said. "It’s time for AI to prove its unequivocal value to the world, and what better way to demonstrate that than to help finally cure diseases like cancer."

For years, Dean and Hassabis were considered Google’s preeminent AI figures. Hassabis co-founded DeepMind in 2010, continuing to lead the London-based lab after its acquisition by Google in 2014 for approximately $650 million.

Dean, in 2011, co-founded Google Brain, a US-based unit that conducted AI research independently of Hassabis’s team. He was already a revered figure within Google, recognized for his collaboration with Ghemawat on foundational infrastructure projects that still power the company.

In 2023, following the unexpected launch of OpenAI’s ChatGPT, Pichai merged DeepMind and Google Brain into a new entity, Google DeepMind, with Hassabis as CEO and Dean as chief scientist. Until recently, Dean, Vinyals, and Noam Shazeer had jointly led the development of Gemini.

Their stewardship saw the release of Gemini 3 last November, which was widely seen as narrowing the gap with leading models from Anthropic and OpenAI.

However, subsequent advancements from these rivals, coupled with the growing momentum of more affordable Chinese open-source models, have placed Google on the defensive.

At Google's annual developer conference in May, Pichai and other leaders emphasized Gemini's cost advantage rather than its cutting-edge capabilities.

The "brain drain" intensified in June when Shazeer departed for OpenAI, less than two years after Google reportedly spent billions to recruit him and his team. In the same week, senior research scientist John Jumper, who shared a Nobel Prize with Hassabis in 2024, announced his move to Anthropic.

Vinyals, Le, and former OpenAI chief scientist Ilya Sutskever notably co-authored a seminal 2014 research paper that laid the groundwork for modern AI research by demonstrating the power of scaling data to "pre-train" AI systems.

Discovery Loop has secured investment from Google and forged a partnership with its cloud division to provide computing capacity.