Google stock fell as much as 10% after the quarterly results were released, The Decoder reports. Cloud revenue more than doubled to 30,7 billion dollars, while search revenue grew by 12% — slower than expected.
Google acknowledged that the rapidly growing AI Mode mode generates less revenue than traditional search. The company is also expanding the international advertising program within AI Mode.
For Google, this raises a measurable question about the shift from traditional search advertising to AI-generated answers. But the source does not provide a full set of financial metrics, investor comments, or data on the scale of the advertising program, so conclusions about the causes of the stock drop remain limited.
editorial commentary
Why it matters
Likely consequence — increased focus on how Google will monetize AI Mode without weakening the search business. The next observable signal will be data on AI Mode revenue and results of its international advertising program. Significant uncertainty remains: the provided material does not allow separating the influence of AI Mode from other market reaction causes.