- Published on
Google expands AI Search ads globally as core ad growth slows
- Authors
- Name
- DeepHorus
Google announced Wednesday it will expand ads in its AI-powered Search experiences to international markets, betting generative AI can open new revenue as core search ad growth slows. The move came during Alphabet’s third-quarter earnings call, where revenue rose 25% to $127.6 billion. Alphabet shares fell 8% after the results.
Google Search revenue grew 12% year over year in the third quarter, down from 17% in the second and 19% in the first. That slowdown puts pressure on Google to monetize AI features. Philipp Schindler, chief business officer, said Google is “scaling high-quality ads within AI overviews in AI mode” to more users and queries, taking its monetization footprint global for the first time.
Early results suggest the formats work: click-through rates for sponsored product listings in AI Mode are comparable to organic listings, Schindler said. User research also indicates people find the ads relevant. The effort builds on Google’s May launch of Gemini-powered ad formats, including conversational discovery ads and sponsored recommendations in AI answers.
CEO Sundar Pichai said Search queries grew at their fastest rate in five years. AI Mode queries are three times longer than traditional searches, and one in five involves voice, images, or documents. Google surpassed 50 billion visual searches monthly.
Alphabet’s Google Services division, including Search, generated $96.3 billion in revenue, up 11% year over year. Google Cloud revenue surged 103% to $30.7 billion. The quarter also included Gemini 4 Argon’s release, the Gemini app reaching 1 billion monthly users, and the Pixel 11 launch.
The global expansion signals Google’s bet that generative AI can offset slower core ad growth. By integrating ads into AI overviews and multimodal queries, Google aims to capture new advertising opportunities as user behavior evolves. How well these formats scale internationally will be closely watched by investors and advertisers.
