Google puts ads into AI search worldwide, as its search growth slows

Alphabet’s revenue grew 25% to $127.6 billion, but search advertising grew 12%. Google says people are searching more, and longer, in AI Mode, which earns less so far. Its answer is to show ads in AI Mode outside the US for the first time.

By Roman Aglaganov29 OCT 2026Global

Illustration: a black search field outline above a column of grey lines of varying length, with one red rectangle slotted in among the lines — Illustration: AI Pulse.

Alphabet reported its third-quarter results on 28 October. Revenue rose 25% from a year earlier to $127.6 billion, and Google Cloud more than doubled. But growth in Google’s core search advertising was slower, at 12%, to $63.35 billion. On the earnings call, the company explained part of the gap with its own AI features.

More searching, fewer ads

Chief executive Sundar Pichai said query growth was the fastest in five years. Queries in AI Mode, Google’s chatbot-style search, are on average three times longer than traditional searches, and one in five AI Mode searches uses voice, images or documents.

But Google has shown fewer ads in its AI answers than on its classic results page. Philipp Schindler, the chief business officer, said “the strong growth in AI Mode queries had an impact because of the lower monetization we were seeing in AI Mode.” He added that most AI Mode queries are “incremental”, meaning they are searches people would not otherwise have made, so they create room for more ads over time.

Ads go global

Google’s response is to put more ads into those answers. Schindler said the company is now “scaling high-quality ads within AI Overviews and AI Mode to more users and queries”, including bringing ads in AI Mode to international markets for the first time, and introducing “multiturn ads” in AI Mode in the US, which can appear as a conversation continues. He said click-through rates on sponsored and organic product listings in AI Mode are already similar, and that Google’s research shows people find the ads relevant.

For websites and publishers, this matters as much as it does for advertisers. As more answers appear directly on Google’s page, fewer people click through to the sites the answers draw on, and sponsored placements inside those answers become a more important way to be seen.

Spending

Alphabet spent $51.4 billion on capital projects in the quarter, mostly servers, networking and data centres for AI, and kept its forecast of $195 billion to $205 billion for the year. Free cash flow was negative, at minus $9.1 billion, which the company put down to that spending, a build-up of chips for its TPU sales, and a $5.2 billion payment for a 2018 European Commission fine. Net income fell, mainly because of an unrealised loss on Alphabet’s stake in SpaceX.