Google is putting paid ads inside AI Mode, its chatbot-style search, in 10 more countries. In the US, ads can now also appear when you ask a follow-up question. The move came on the same day Alphabet reported that its core search revenue grew 12% a year, its slowest pace this year.
What is changing
AI Mode is the tab in Google Search where you ask a question in full sentences and get a written answer rather than a list of links. Until now, ads there were largely a US affair. In a blog post on Wednesday, Shashi Thakur, who runs Google’s search ads, said they are now scaling in Australia, Canada, India, Kenya, Malaysia, New Zealand, Nigeria, Pakistan, the Philippines and Singapore. Brazil, Mexico and the UK are due later this quarter, with no exact dates.
The second change is in the US. Google calls it multiturn ads: sponsored results that can show up during a back-and-forth, not just after your first question. Android Authority gives the example of asking for a laptop, then narrowing it to models under $1,000, and seeing ads on that follow-up too. Google says every ad will be labelled “Sponsored”.
The number behind it
Alphabet’s third-quarter earnings release shows Google Search and other revenue of $63.4 billion for the three months to 30 September, up from $56.6 billion a year earlier. That is growth of 12%. TechCrunch reports it was 17% in the second quarter and 19% in the first. Total Alphabet revenue was $127.6 billion, up 25%, lifted mostly by Google Cloud.
Plainly read, search still makes Google more money every quarter, but the gains are shrinking. Ads in AI answers are Google’s attempt to make sure the new way of searching pays at least as well as the old one.
What it means for you
Google says queries in AI Mode are on average three times longer than normal searches, so it knows more about what you want, and that click rates on sponsored product listings in AI Mode are already similar to unpaid ones. That second figure comes from Google and has not been checked independently.
For users in the new countries, the practical point is simple: a recommendation in an AI answer may now be paid for. Look for the “Sponsored” label before you treat a suggested product as the AI’s own pick. For investors, it is the other half of a week in which Google’s spending on AI ran ahead of the cash it brought in.
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