Google says AI Mode monetizes less as classic search funds its AI push

Google acknowledged to investors that strong query growth in AI Mode is accompanied by lower monetization. According to Xataka, the format uses Gemini to answer with generated text instead of showing a list of links, reducing the space for ads and the reasons to click them. Google chief commercial officer Philipp Schindler said many AI Mode queries are incremental, but did not say how much less they earn.

According to Xataka, Alphabet posted $127.577 billion in revenue in the third quarter, with search contributing $63.350 billion. The company spent $51.355 billion on equipment and facilities during the period, more than the $42.290 billion generated by its business. A Pew Research Center study cited by Xataka found that 8% of visits ended in a click on a reference link when an AI summary was present, compared with 15% without the summary; Google challenged the study’s methodology.