AI has made Google more profitable when people expected the contrary

When OpenAI released ChatGPT and it quickly became the fastest growing product by users, a lot of people said it was the end of Google.

Specifically, people believed that this was going to kill Google Search, but revenue numbers tell a different story.

Alphabet, Google's parent company beat revenue estimates and achieved its first quarter earning north of $100 billion in revenue thanks to AI.

Five years ago, Alphabet was at $50 billion revenue, quarterly, and today, that number has doubled.

Google and Alphabet CEO Sundar Pichai told investors that AI has made Google Search more successful.

This will be surprising to many as the contrary was widely expected. People are now increasingly using Google Search thanks to AI, Sundar said.

AI is driving an expansionary moment for Search. As people learn what they can do with our new AI experiences, they are increasingly coming back to Search more. Search and its AI experiences are built to highlight the web, sending billions of clicks to sites every day.

During the Q2 call we shared that overall queries and commercial queries continued to grow year over year. This growth rate increased in Q3, largely driven by our AI investments in Search, most notably AI Overviews and AI Mode.

As we've shared before, AI Overviews drive meaningful query growth. This effect was even stronger in Q3, as users continue to learn that Google can answer more of their questions. And it’s particularly encouraging to see the effect was more pronounced with younger people.

We are also seeing that AI Mode is resonating well with users. In the U.S., we've seen strong and consistent week-over-week growth in usage since launch and queries doubled over the quarter. Over the last quarter, we rolled out AI Mode globally across 40 languages in record time. It now has over 75 million daily active users. And we shipped over 100 improvements to the product in Q3 — an incredibly fast pace. Most importantly, AI Mode is already driving incremental total query growth for Search.

Q3 earnings call: Remarks from Google and Alphabet CEO, Sundar Pichai | Oct 29, 2025

This is such an easy data to trust because I actively use Google Search and can testify to my increased usage thanks to AI's integration.

I also find that how I use Google Search has changed as a result, my queries are more uniquely structured and time-saving from results being summarized is quite appealing.

Alphabet's advertising revenue is up 12% year-over-year and Google Cloud is also becoming more profitable thanks to AI, with $15.15 billion in revenue, a 33% year-over-year increase. Nine of the top 10 AI labs choose Google Cloud and the number of new GCP customers increased by nearly 34% year over year.

Sundar noted that the company has signed more deals over $1 billion through Q3 this year than they did in the previous two years combined.

13 product lines are each at an annual run rate over $1 billion, Gemini has 650 million active monthly users and the company has crossed 300 million paid subscriptions.

Google (Alphabet) is growing more profitable thanks to AI.

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