Google takes AI search ads international as search growth slows

A new surface for ads

Google’s chief business officer, Philipp Schindler, said the company is expanding “quality ads” in AI Overviews and AI Mode so they reach more users and appear for more queries. He said this is the first time Google has brought these ad formats to international markets.

The move builds on formats Google introduced in May using Gemini, including conversational ads that answer users’ questions and sponsored recommendations in AI-generated responses.

Google says early results are encouraging. Schindler said click-through rates on product ads in AI Mode are already comparable to those on regular search results. The company’s research also suggests users consider the ads relevant. Neither claim comes with figures in the announcement.

Search is changing shape

CEO Sundar Pichai said search queries grew year over year at their fastest pace in five years, without specifying the rate. He also described queries as longer and more complex as AI features change how people use search.

Search advertising revenue grew 12%. Google Services, which includes search, brought in $96.3 billion, up 11% year over year. Google Cloud revenue rose 103% to $30.7 billion.

The quarter also brought the release of Gemini 4 Argon, Gemini’s app reaching 1 billion monthly users, and the launch of the Pixel 11 lineup.

The missing measure

I think the key uncertainty is not whether people are using AI search, but whether its new ad formats can sustain the economics of the old results page. Comparable click-through rates are a useful early signal, but they do not show how much revenue each query generates, or whether advertisers will keep paying as placements spread across more markets and more kinds of searches.

Google is expanding the inventory before offering that answer. With search ad growth at 12%, the company has a reason to make AI search commercially productive; the harder test is whether the new interface can do so without making its ads feel less relevant.