Alphabet CEO Sundar Pichai declined to answer an investor question about Google's AI partnership with Apple during the company's Q4 earnings call on Wednesday. The question, focused on how Alphabet views AI partnerships like the recently announced Gemini-Siri deal, was completely skipped.
The non-response is worth noting. This partnership, confirmed February 2, puts Google's Gemini AI into Siri and Apple's foundation models starting Spring 2026. Apple has 2.5 billion active devices worldwide. Estimates peg the deal at $1 billion annually (Bloomberg) or potentially $8-12 billion (analyst extrapolations based on the existing search partnership). That search deal, revealed in DOJ filings, costs Google $20 billion per year.
The real question is regulatory exposure. A January 2026 DOJ antitrust ruling already found Google's search monopoly illegal, specifically targeting exclusive default agreements. An AI partnership of this scale, layered on top of the search deal, presents an obvious target. Appeals are pending, but the pattern is clear.
Alphabet's stock climbed 1.7% on the announcement, pushing market cap over $4 trillion. The company's forward P/E of 28 (versus Microsoft's 24) suggests investors are pricing in AI growth. Whether that growth materializes without regulatory interference is the open question.
What this means in practice: Enterprise teams evaluating Gemini for their own deployments now know it's proven enough for Apple's privacy requirements. The deal leverages Google Cloud for on-device and Private Cloud Compute processing, meeting Apple's standards. That's a technical validation worth noting.
The fine print matters here. The partnership is non-exclusive, meaning Apple can still work with other AI providers. Apple evaluated multiple vendors and chose Gemini for reasoning capabilities, according to Stanford benchmarks. But Elon Musk called the deal an "unreasonable concentration of power" for Google, and he's not wrong about the competitive dynamics.
Alphabet's silence on the earnings call tells you everything: they know this deal is material, they know it's complicated, and they're not ready to quantify either the upside or the regulatory risk. We'll see.