Google search grows stronger in the AI age

AI overviews are increasing engagement, but challenges to monetization remain

Google’s search engine has so far proven resilient in the AI era, leveraging its Gemini-powered “AI Overview” feature to drive more searches and boost revenue. While these features increase engagement, they also pose challenges for click-through rates, leaving Google to balance user satisfaction with advertiser value.

Key takeaways

• AI Overview adoption surges: Google’s Gemini-powered overviews now have over 2 billion monthly users, up from 1.5 billion last quarter.
• Search engagement increases: Search impressions grew 49% year-over-year since the feature’s launch, according to BrightEdge data.
• Revenue hits a record: Search revenue rose 12% year-over-year in Q2 to $54.2 billion, exceeding analyst expectations.
• Click-through challenge: While impressions are up, users click fewer links when AI overviews provide direct answers, affecting ad performance.
• Competitive pressures: Startups like Perplexity and OpenAI are developing AI-infused browsers, potentially challenging Chrome and Google’s ad model.
• Defensive strategy: Google plans to invest $85 billion in 2025 capital spending and continue embedding AI across products, following a track record of adapting to past disruptions.
• Long-term risks: The company faces growing antitrust scrutiny and must prove AI-driven answers still deliver returns for advertisers.

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