Google’s AI divisions are getting reshuffled, the search giant announced on Wednesday, with chief scientist Jeff Dean leaving the company after 27 years.
Demis Hassabis, the CEO of Google DeepMind, is moving into a chairman role of that unit and also assuming the title chief scientist of parent company Alphabet, according to a memo from CEO Sundar Pichai that was posted to Google’s blog.
Alpahbet shares fell about 4% after the announcement.
Dean, a pioneer in artificial intelligence who’s been credited with some of Google’s most important technical breakthroughs, is starting his own company along with Google senior fellow Sanjay Ghemawat, the post said. The departure is on friendly terms and Google will invest in his startup, a representative said.
“After an incredible 27-year run, Jeff Dean is at a moment where he wants to try something new, and we’re excited to support him in that,” Pichai said in the post. He added that Dean and Ghemawat will be working to “accelerate discoveries” in machine learning, science and engineering.
The shakeup, which includes promoting DeepMind technology chief Koray Kavukcuoglu to head of the AI division, comes as Google navigates a rapidly evolving AI industry, with the company trying to compete against OpenAI and Anthropic in developing the most cutting-edge frontier models while also pouring money into infrastructure so that its cloud division can serve customers as well as its own workloads.
In the latest quarter, Google turned cash flow negative for the first time on record due to its capital expenditures, while forecasting full-year capex of up to $205 billion. Kavukcuoglu will lead the development of Gemini 4, the company’s next major AI model, and will report to Pichai.
Hassabis co-founded DeepMind and joined Google when the search giant purchased the lab in 2014. In recent years, he’s been leading nearly all of Alphabet’s foundational AI work.
“I’ve decided that now is the right time for me to hand over my day-to-day operational responsibilities at GDM, so that I have the time and space to focus on the big picture and help influence what is to come to the best of my ability,” Hassabis said in a note to employees.
He added he would work with Pichai on “strategic and global” matters related to AI.
In a followup post on X, Dean said his new startup will be called Discovery Loop, and that it will be organized as a public benefit corporation focused on AI for science and engineering.
From a growth perspective, Google has been doing just fine on AI. The company’s cloud division, run by Thomas Kurian, is expanding at a much faster clip than larger rivals Amazon Web Services and Microsoft Azure.
Cloud revenue at Google soared 82% in the second quarter to $24.8 billion. AWS reported revenue growth of 37% in the quarter, while Azure sales climbed 43%.
Pichai said on the earnings call that cloud expansion was driven by AI infrastructure and AI solutions, noting and was helped by demand for the company’s homegrown tensor processing units (TPUs).
The report came a day after Google announced three new Gemini models, including its clearest answer yet to Anthropic‘s lead in cybersecurity, though the company still hasn’t released Gemini 3.5 Pro, which has been delayed.
“Demand for our models is translating to strong token usage across developers and enterprise customers,” Pichai said on the earnings call. “And we continue to be supply constrained, a sign of momentum and rapid adoption.”
WATCH: Hassabis on state of AI race
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