Key facts
- Google's third-quarter search revenue missed market estimates.
- The company's share price fell around 10% after hours.
- Google CEO Sundar Pichai stated that monetization efforts are being prioritized after improving the user experience.
- Chief business officer Philipp Schindler cited foreign-exchange headwinds and lower monetization from AI-related queries as factors impacting search revenue.
- Google is scaling ads in AI Mode and Overviews to more queries.
Google is expanding its AI-powered Search ads globally as it faces slowing growth in its core advertising business. Despite reporting a 12% year-over-year increase in search revenue for the third quarter, the company's overall revenue of $127.6 billion missed market estimates, leading to a roughly 10% drop in its share price after hours. Google CEO Sundar Pichai indicated that the company is prioritizing user experience improvements in Search, with monetization efforts to follow, similar to its past shift to mobile. Chief business officer Philipp Schindler attributed the revenue miss to factors including foreign-exchange headwinds and lower monetization from AI-related queries, though he noted promising results from ad experiments and plans to scale them further.