Google Expands AI Search Ads Globally as Traditional Ad Growth Slows

In a move that signals a clear strategic shift, Google has announced the expansion of its ads within AI-powered search experiences to international markets for the first time. The step comes at a time when the tech giant is facing a gradual slowdown in the growth of its traditional search advertising business, pushing it to turn its intelligent features into an actual source of revenue rather than merely experimental capabilities.

Strong Financial Numbers with Warning Signs

Alphabet, Google's parent company, revealed third-quarter results with total revenue of $127.6 billion, representing 25% year-over-year growth. Nevertheless, the company's shares fell 8% following the announcement, due to the continued slowdown in search ad revenue growth, which rose only 12% compared to 17% in the second quarter and 19% in the first quarter of the same year. This gradual decline puts additional pressure on Google to prove its ability to convert its massive investments in artificial intelligence into tangible returns.

Global Expansion of AI Mode Ads

Philipp Schindler, Google's Chief Business Officer, stated during the investor call that the company has begun expanding high-quality ads within AI Overviews to more users and queries, noting that this is the first time the funding footprint has gone global. The expansion includes launching AI Mode ads in international markets alongside multi-turn ads in the United States.

This move builds on announcements made last May regarding new ad formats powered by the Gemini model, including conversational discovery ads that answer users' questions, and sponsored recommendations integrated within automatically generated responses.

Encouraging Early Results

Google affirms that early indicators are positive, with Schindler explaining that click-through rates for sponsored product listings in AI Mode have become comparable to their organic counterparts, while user research shows that people find these ads relevant to their actual needs.

A Radical Shift in Search Behavior

For his part, CEO Sundar Pichai confirmed that search queries grew at their fastest annual pace in five years, without disclosing the exact figure. He attributed this growth to the impact of AI features in changing the way people use search, with the most notable observations including:

• The average length of queries in AI Mode is three times that of traditional search.
• One-fifth of smart searches worldwide rely on voice, images, or documents.
• Visual searches have surpassed 50 billion per month.

Pichai described search as the product that delivers the benefits of artificial intelligence to more people than any other product in the world, noting that user queries have become longer, more personalized, and multimodal.

Notable Performance in Other Segments

Google Services, the segment that includes Search, recorded revenues of $96.3 billion, up 11%, while Google Cloud revenues jumped 103% to reach $30.7 billion, a performance reflecting the growing demand for AI cloud infrastructure. The quarter also saw the launch of the Gemini 4 Argon model, the Gemini app reaching one billion monthly users, and the release of the Pixel 11 phone lineup.

What Does This Mean for Advertisers and Users?

This shift sends a clear message to advertisers around the world: the future of digital advertising is taking shape within AI experiences. With click-through rates converging between sponsored ads and organic results in AI Mode, investing in these new formats becomes a logical choice for reaching an audience that searches in deeper and more detailed ways than ever before. As for users, the challenge remains maintaining a delicate balance between sponsored content and the quality of the answers provided.

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