Why Snap Stock Hit the Market Today

Artificial intelligence (AI) continues to be a technology of interest to many investors, who hope that its integration will help boost the fundamentals of portfolio companies. That was the dynamic behind it Snap (SNAP 3.63%) shares rose 3.6% on Tuesday as news of an expanded business partnership with a leading tech name involving artificial intelligence sent market players into the stock. This increase was much higher than that of S&P 500 index, which posted a marginal gain of 0.3% on the day.

A long-standing partnership expands with AI

Before the market opens, Alphabethis (GOOG 0.35%) (GOOGL 0.27%) The Google Cloud unit announced that it and Snap have expanded their existing strategic partnership to cover AI functionality for the latter company’s My AI chatbot.

Under the terms of the expanded agreement, the social media company’s core Snapchat will use Google’s latest Gemini AI chatbot technology to enhance My AI functionality.

Google Cloud wrote that Snap would particularly benefit from “the technology’s ability to understand and operate on different types of information such as text, audio, image, video and code to deliver more engaging and innovative features for the Snapchat community.”

Snap and Alphabet have a relatively long history as partners; Snapchat was launched on Google Cloud in 2011.

Innovation to drive user engagement

Google Cloud did not disclose the financial terms of the extended relationship between the two partners. Snap CEO Evan Spiegel said that with Gemini as a foundation, “Snapchatters can learn so much about the world, they can do it very quickly in the moment, and they can easily share it with friends.”