Google execs say employees have to ‘be more AI-savvy’ as competition ramps up

Google executives are pushing employees to act with more urgency in their use of artificial intelligence as the company looks for ways to cut costs.

That was the message at an all-hands meeting last week, featuring CEO Sundar Pichai and Brian Saluzzo, who runs the teams building the technical foundation for Google’s flagship products.

“Anytime you go through a period of extraordinary investment, you respond by adding a lot of headcount, right?” Pichai said, according to audio obtained by CNBC. “But in this AI moment, I think we have to accomplish more by taking advantage of this transition to drive higher productivity.”

In its earnings report last week, Alphabet said it plans to spend $85 billion on capital expenditures in 2025, up from the $75 billion it was targeting earlier in the year. It’s a theme that’s resonating across technology, where internet giants are racing to build costly data centers to run big AI models and workloads while simultaneously cutting expenses elsewhere.

“We are competing with other companies in the world,” Pichai said at the meeting. “There will be companies which will become more efficient through this moment in terms of employee productivity, which is why I think it’s important to focus on that.”

In June, Amazon CEO Andy Jassy said the company’s corporate workforce will shrink in the coming years as it adopts more generative AI tools and agents. In an email to employees, Jassy wrote that employees should learn how to use AI tools and experiment and figure out “how to get more done with scrappier teams.”

Microsoft‘s president overseeing developer tools, Julia Liuson, told employees in June that “using AI is no longer optional.” Shopify CEO Tobi Lutke said in April there’s a “fundamental expectation” that employees are using AI in their day-to-day work and, before asking “for more headcount and resources, teams must demonstrate why they cannot get what they want done using AI.”

While Alphabet’s headcount has been ticking up in recent quarters, it’s still below the peak from 2023, when the company had close to 191,000 full-time employees. The number was just over 187,000 at the end of June, according to Alphabet’s quarterly financial filing last week. Google eliminated about 6% of its workforce in early 2023 and has implemented cuts in various groups since then, offering buyouts to employees since the beginning of the year.

“We are going to be going through a period of much higher investment and I think we have to be frugal with our resources, and I would strive to be more productive and efficient as a company,” Pichai said, adding that he’s “very optimistic” about how Google is doing.

Google declined to comment on the remarks.