Google’s AI-powered search is challenging its advertising business, with third-quarter search ad revenue falling short of expectations.
During the Q3 2026 earnings call, Google disclosed that its AI Mode generative search is disrupting traditional search advertising, as AI-generated summaries and answers reduce the commercial monetization potential of search results. Chief Business Officer Philipp Schindler stated that AI responses are reshaping how search results are presented, making it more difficult to monetize ads. In the third quarter, search ad revenue reached $63.4 billion, up 12% year over year, but fell about $1.6 billion short of Wall Street estimates, with growth also lagging behind expectations.


