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Google's Gemini 3.5 Pro Delayed as Morale Sinks: Talent Exodus and Military Deals Rattle Staff

Google's much-anticipated flagship AI model, Gemini 3.5 Pro, is running behind schedule, and according to six current and former employees of Google DeepMind, a big reason is the sinking morale inside the company. Bloomberg had already reported that the model was months late, and the recent string of smaller models Google has put out has gotten a lukewarm reception at best. Even Meta AI's head, Wang Tao, took a jab on X, saying, "Gemini? Never heard of it."

Talent Exodus and the Military Deal

Google is losing some of its brightest stars. Noam Shazeer, who co-led the Gemini project, has jumped ship to OpenAI. Nobel Prize-winning chemist John Jumper has moved to Anthropic. And several employees have resigned specifically because of Google's April agreement with the U.S. Department of Defense—a deal that came up again and again in exit interviews. Alex Turner, a former research scientist who left over the military contract, noted that CEO Demis Hassabis is far less visible internally compared to rivals like Sam Altman and Dario Amodei. One employee put it bluntly: "We are falling behind." The Gemini series hasn't even cracked the top ten in the OpenRouter large language model rankings.

Spending Spree and Investor Jitters

Google's total spending this year is expected to hit $19 billion, and its free cash flow has turned negative. There's growing unease about whether all that AI investment will pay off. Google, for its part, denies that morale issues are causing the delays. The company says its AI talent attrition rate this year is actually lower than last year, and over 90% of people who receive job offers accept them. A spokesperson said they're happy with the Flash series and the roadmap ahead. But the report suggests that while Google can afford to be temporarily outpaced by competitors, it can't afford to keep losing talent and testing investors' patience.

Key Points

  • Gemini 3.5 Pro is delayed, with insiders citing low employee morale as a contributing factor.
  • Top talent is leaving: Key researchers have moved to OpenAI and Anthropic.
  • Military contract backlash: The Pentagon deal has prompted resignations and is a recurring theme in exit interviews.
  • Financial strain: Google's AI spending has led to negative free cash flow, raising concerns about returns.
  • Google denies morale issues, stating that attrition is down and offer acceptance rates are high.