Google expands AI Search ads globally as core ad growth slows
techcrunch ·
Google is expanding its AI-powered search advertisements to international markets, aiming to generate new revenue as growth in its core search advertising business decelerates. During Alphabet's third-quarter earnings call, the company reported $127.6 billion in total revenue, a 25% year-over-year increase, yet its stock fell 8% due to slowing ad growth. Google Search revenue grew by only 12% in the quarter, down from previous quarters, highlighting the pressure to monetize AI features effectively. Chief Business Officer Philipp Schindler announced that high-quality ads within AI Overviews are now being scaled globally, alongside multi-turn ads and AI mode in the U.S. Early data indicates that click-through rates for sponsored listings in AI Mode are comparable to organic results, with users finding the ads relevant. CEO Sundar Pichai noted that search queries have reached their fastest growth rate in five years, driven by longer, multimodal interactions facilitated by AI. Additionally, Google Cloud revenue surged 103% to $30.7 billion, contributing significantly to the division's overall performance.
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