Market & Regulation
Google's AI search growth stalls monetization
The Verge AIhigh confidence
Why it matters
- →AI-driven search traffic currently monetizes at a lower rate than traditional keyword searches, threatening ad revenue growth.
- →Alphabet's $200 billion infrastructure spend faces scrutiny as core business growth slows amid this transition.
- →The industry lacks a proven, scalable ad format for conversational AI that balances user experience with advertiser ROI.
Alphabet reported third-quarter search revenue growth of 12%, down from 17% in the prior quarter, as paid click growth slowed to 8%. Chief Business Officer Philipp Schindler attributed part of this slowdown to AI Mode queries monetizing at a lower rate than traditional searches, despite being largely incremental. Alphabet shares have fallen approximately 14% since the earnings report, reflecting investor concern over the return on $200 billion in planned AI infrastructure spending. Industry analysts note that while advertisers still see overall returns, Google has not yet isolated or proven the specific performance of AI-generated ad inventory compared to traditional search ads.
Read originalThe story around this
TopicGoogle AI Search Ads
Earlier coverage that leads up to this article, and what followed. Lines connect each piece to the closest one after it, converging here.
How we got here
- 1Enterprises Struggle with AI Infrastructure Costs
VentureBeat AI · July 16, 2026 · Background
- 2Google Revamps Gemini AI Usage and Pricing
WIRED AI · July 18, 2026 · Background
- 3Google's AI Spending Justified by Cloud Revenue Surge
TechCrunch AI · July 22, 2026 · Related
- 4Google Enhances AI Tools for Marketing Platforms
Google AI Blog · August 10, 2026 · Background
- 5ChatGPT Ads Hits $1B Revenue Run Rate
OpenAI · August 31, 2026 · Background
- 6Google pilots payments to publishers for AI search content
The Verge AI · September 30, 2026 · Background
- 7Google AI Search Traffic Collapse
The Verge AI · October 25, 2026 · Related
- 8Big Tech AI spending boom faces investor skepticism
TechCrunch AI · October 30, 2026 · Related
What happened next
- 9The emerging economics of ads in AI chatbots
WIRED AI · November 5, 2026 · Related
Follow this story
Open the full story →Google expands AI Search ads globally
2 developments
- Oct 28 · TechCrunch AI
Google expands AI Search ads globally - Nov 4 · The Verge AI
Google's AI search growth stalls monetization (This article)↳ Google shares drop 14% as AI search growth stalls ad revenue, with paid clicks falling to 8% despite surging queries.
More from The Verge AI
© The Verge AIGeneral AIproductivity
Meta Muse launches custom 'spaces' for AI workflows
Meta is shifting Muse from a passive chatbot to an active workspace with 'Spaces,' letting users build persistent, app-like interfaces for specific tasks like shopping or scheduling. By connecting external services like Gmail and Notion, these spaces pull live data into the UI, effectively turning natural language prompts into functional dashboards. This moves AI interaction beyond simple Q&A toward structured, goal-oriented environments that adapt to your daily context.
The Verge AI
© The Verge AIVideo & Creative AImusic
inMusic embraces open-source modding for hardware
The music hardware industry is pivoting from closed ecosystems to open modding, led by inMusic's decision to release source code and SDKs for devices like the MPC Sample Key. This strategic shift acknowledges that 'vibe coding' has become a dominant force in creative tech, forcing legacy manufacturers to provide safe tinkering environments rather than fighting it. While competitors like Elektron remain cautious about bricking risks, inMusic is betting that community-driven innovation will drive engagement and loyalty. The move signals a broader acceptance of user-generated firmware as a standard feature in professional audio gear.
The Verge AI
© The Verge AIGeneral AIother
Amazon adds text-based shopping to Alexa
Amazon is extending its AI shopping assistant into the SMS layer, letting users text product requests or photos directly to a contact labeled 'Amazon Alexa.' This moves conversational commerce out of proprietary apps and into the universal interface everyone already uses. By remembering preferences like vegan diets and tracking price drops, it attempts to replicate the convenience of voice assistants without requiring a smart speaker. The rollout starts with a small US group before expanding to millions, signaling Amazon's bet that text is the next friction point for impulse buys.
The Verge AI
More in Market & Regulation
© TechCrunch AIMarket & Regulationbusiness
Google buys Crusoe's Wyoming data center project
Google is acquiring an unfinished data center from Crusoe in Wyoming, signaling a strategic pivot to direct infrastructure control amid scaling pressures. The $17 billion investment highlights the immense capital required for AI compute, as independent developers struggle with cost and timeline overruns. This move illustrates the growing vertical integration of tech giants into physical infrastructure, reducing reliance on third-party providers like Crusoe for massive deployments. By taking ownership, Google bypasses the bottlenecks that often plague external development teams. The deal reflects a broader industry trend where hyperscalers reclaim control over their most critical assets. Independent builders now face stiffer competition from companies with deeper pockets and direct operational oversight.
TechCrunch AI
© TechCrunch AIInvestment · $11B
Market & Regulationbusiness
OpenAI raises $11B at $1.25T valuation
OpenAI is securing an additional $11 billion in a funding round that values the company at $1.25 trillion, falling short of its initial $30 billion target but still signaling massive investor confidence. This latest capital injection comes as the broader AI market faces headwinds, with Anthropic’s potential IPO valuation also cooling from earlier highs. The move highlights OpenAI's continued ability to attract deep-pocketed support despite regulatory uncertainties and political shifts affecting data center expansion. While the round hasn't fully closed, the sheer scale of this valuation reinforces OpenAI's dominant position in the race for AI supremacy. Investors are betting big on the lab's ability to maintain its lead in compute and model capabilities. The delay in IPO plans suggests a strategic pause to navigate these complex market conditions. This funding ensures OpenAI remains the financial heavyweight in the sector.
TechCrunch AI
© The AI Daily BriefMarket & Regulationbusiness
Enterprise AI Spending Surges 5x Year-Over-Year
Menlo's latest report reveals enterprise AI spending has increased nearly five times in one year, primarily driven by the adoption of AI agents.
The AI Daily Brief