Hassabis hands over DeepMind as Google's AI race wobbles

Demis Hassabis is stepping down as CEO of Google DeepMind, handing day-to-day operations to longtime lieutenant Koray Kavukcuoglu while he moves into a chairman role and adds the title Chief Scientist of Alphabet. At the same time, Jeff Dean — the engineer who built much of Google’s AI infrastructure over 27 years — is leaving to start a new company called Discovery Loop. Alphabet shares fell about 4 per cent on the announcement.

The timing is uncomfortable. Google’s Gemini 3.5 Pro is reportedly months behind schedule. Several top researchers, including Gemini’s co-lead, have already walked to competing labs. The company just turned cash flow negative for the first time on record, forecasting up to $205 billion in capital expenditures this year. Now the two most recognisable figures in Google AI are both moving on from their roles on the same day.

What actually changed

Hassabis becomes Chair of Google DeepMind and Chief Scientist of Alphabet. He’ll advise on “strategic and global AGI matters” and continue leading Isomorphic Labs, the drug discovery spinoff. He framed the move as freeing him to focus on the big picture.

“I’ve been working towards AGI my whole life and now, like many of you, I feel it is close at hand. It’s critical that we collectively get the next steps right to ensure this all goes well for humanity.”

Kavukcuoglu, who has been at DeepMind since its early days and currently serves as CTO, becomes SVP reporting directly to Pichai. He’ll oversee Gemini model development, frontier AI research, and the Gemini app and developer teams. In his own memo, he named the Gemini roadmap as his primary focus — and used the word “velocity” twice.

Jeff Dean’s departure is the bigger surprise. He’s been at Google since 1999, credited with foundational work on MapReduce, BigTable, and TensorFlow. He and Google Senior Fellow Sanjay Ghemawat are launching Discovery Loop as a public benefit corporation focused on AI for science and engineering. Gemini co-lead Oriol Vinyals and Google Brain co-founder Quoc Le are joining them. Google will be a founding investor and Cloud partner.

Dean told The New York Times that leaving a public company gives him more room to prioritise scientific discovery over financial returns. “We might make decisions that are not necessarily in the company’s purist financial interests,” he said.

The spin versus the signal

Sundar Pichai’s blog post reads like a promotion — Hassabis elevated to a grander AGI role, Dean supported in a new venture. That’s one reading. The other is that Google has been bleeding AI talent, and two of its most senior figures just voluntarily stepped away from the operational helm. Axios notes the changes come “after a groundswell of pushback from Google DeepMind employees and several high profile talent exits.” The Gemini app has 950 million monthly users and Gemma downloads have surpassed 900 million, but the frontier model race is where reputations are made, and Google’s last major release — Gemini 3.5 Pro — is the one that’s behind schedule.

Hassabis has been public about his AGI timeline for months, describing humanity as standing in the “foothills of the singularity” at Google I/O in May. Whether this restructure lets him focus on that vision or is a sign that the operational reality at DeepMind has become harder to manage is something only the internal memos can fully answer. What’s visible from outside is a company spending unprecedented sums on infrastructure while its leadership bench thins.

The departures also follow the loss of Nobel laureate John Jumper to Anthropic, which was already a signal that DeepMind’s culture of fundamental research was under pressure. Jumper co-led the AlphaFold work that won him and Hassabis the 2024 Nobel Prize in Chemistry. When Nobel-calibre scientists start leaving, the retention problem is no longer hypothetical.

Why Discovery Loop matters

A public benefit corporation is a specific legal structure — it’s not a nonprofit, but it’s legally bound to consider social and environmental impact alongside shareholder returns. Dean choosing this format, rather than a standard startup or staying inside Google, says something about what he thinks the constraints of a publicly traded company look like in 2026. The fact that Google is investing rather than keeping him in-house also suggests an arrangement where independence matters more than retention.

Discovery Loop’s website is already live. Its stated mission is “to accelerate discoveries in ML, science, and engineering.” Beyond that, little is public about what the company will actually build.

The cost context

Google’s Q2 earnings revealed the company went cash flow negative for the first time on record, spending heavily on data centres, TPUs, and Nvidia GPUs. Full-year capex is forecast at up to $205 billion. When the people responsible for making that investment productive are leaving, the question investors are asking is straightforward: is this a planned transition or a warning sign?

Alphabet shares closed down 3.6 per cent at $364.27.

❓ FAQ

Who is replacing Demis Hassabis as DeepMind CEO? Koray Kavukcuoglu, currently CTO of Google DeepMind, becomes SVP of the division reporting to Sundar Pichai. He’ll oversee Gemini model development, frontier research, and the Gemini app.

Is Jeff Dean’s departure amicable? Google says yes — the company is investing in Discovery Loop and will serve as its Cloud partner. Dean told the New York Times he wants to make decisions “not necessarily in the company’s purist financial interests,” which suggests a desire for scientific freedom more than dissatisfaction.

What does this mean for Gemini 4? Kavukcuoglu will lead Gemini 4 development. Hassabis said in his memo that “the Gemini models are in good hands with Koray and the leads, as they have been for a while.” Whether that reassures developers waiting on Gemini 3.5 Pro is another matter.

Does this affect Google’s AGI ambitions? Hassabis frames his new role as doubling down on AGI strategy. He’ll work with Pichai on “strategic and global AGI matters.” But the operational execution now sits with Kavukcuoglu, who has less public profile and will need to prove he can stabilise the ship.