Bank of America: Google bets heavily on AI code, facing siege from industry giants GitLab and JFrog

Zhitong
2025.07.14 13:34
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Google acquired the technology licensing and talent team of AI code generation tool company Windsurf for $2.4 billion, which may intensify competition in the DevSecOps field. Bank of America analysis points out that this move puts pressure on companies like GitLab and JFrog, especially in terms of AI-driven DevSecOps strategic layout. Analyst Koji Ikeda stated that the rapid expansion of private code generation tools and the practical benefits of generative AI have driven this trend, and the market will pay more attention to the strategic responses of GitLab and JFrog

According to Zhitong Finance APP, Google (GOOGL.US) has acquired the technology licensing and talent team of the artificial intelligence (AI) code generation tool company Windsurf for $2.4 billion, a move that may intensify competition in the DevSecOps field. Bank of America analysts pointed out that this could pose competitive pressure on companies like GitLab (GTLB.US) and JFrog (FROG.US).

"AI code generation tools represented by Windsurf and Cursor are becoming the investment focus in the DevSecOps field (application development, security protection, and operation management)," stated the Bank of America analyst team led by Koji Ikeda in an investor report released on Monday. "The rapid expansion of private code generation tools in terms of user scale and revenue growth, along with the practical benefits of generative AI and agent AI in this field, are driving this trend."

The analysis report specifically noted that GitLab has recently emphasized its strategic layout in the AI-driven DevSecOps field.

"In light of the market discussions surrounding the valuation, growth, and differentiation of private code generation tools, coupled with GitLab's decision to include some AI features (such as code suggestions) for free in the paid tiers (Premium and Ultimate packages), we believe the market will pay more attention to whether GitLab's strategic layout for its code generation tools is appropriate," Ikeda stated.

JFrog is also facing new challenges in consolidating its market position.

Ikeda added, "As code generation tools gradually become a key battleground for gaining dominance in the DevSecOps workflow, and as platform providers like GitLab plan to expand binary repository functionalities, we believe discussions about JFrog's long-term industry leadership will intensify. Although our preliminary research shows that JFrog holds a leading position among the top three suppliers (especially in the enterprise market), if the strategic value of binary repository workflows continues to rise, JFrog may need to adopt a more aggressive defensive strategy."

Bank of America has given both GitLab and JFrog a "Buy" rating, with target prices of $72 and $48, respectively.

Notably, Google's acquisition has caused OpenAI's previously proposed acquisition plan to fall through—rumor has it that OpenAI planned to acquire Windsurf for $3 billion back in May this year

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