Google Posts $96B in Q2 Revenue, Spurred by Big AI Investments

The numbers$96.4 billion — Alphabet’s income for Q2, up 14% year-over-year. $54.1 billion — Q2 advert income generated by Google Search and affiliated properties like Gmail and Google Maps.$9.8 billion — YouTube’s Q2 promoting income, pushed primarily by direct response and model promoting.450 million — Month-to-month lively customers of the Gemini app.The watercooler speak It’s AI or bust at Google.In Q2, the tech big up to date its household of Gemini reasoning fashions, rolled out a premium $249.99-per-month AI subscription providing, launched its superior ​​Veo 3 video-generation mannequin and an image-to-video instrument embedded inside Gemini, and unveiled its browser-based AI agent Challenge Mariner. The corporate additionally enhanced AI search with an AI Mode for advanced searches and, in fact, adverts in AI Mode.Throughout the name with buyers, Google CEO Sundar Pichai additionally touted the expansion of AI Overviews, that are AI-generated summaries that seem on prime of some search outcomes, noting they now have over 2 million month-to-month lively customers globally.“We all know how in style AI Overviews are as a result of they’re now driving over 10% extra queries globally for the forms of queries that present them, and this progress continues to extend over time,” Pichai mentioned.This traction is important, as the corporate’s search enterprise is dealing with challengers together with OpenAI, Perplexity, and Anthropic, who’re chipping away at Google’s dominance in internet search. Final month, about 5.6% of all U.S. desktop search visitors was owned by AI engines moderately than Google, based on new information from Semrush’s clickstream information firm Datos. Google has additionally been shuffling its AI expertise because it goes full-throttle on product improvement.Earlier this month it snagged Varun Mohan, cofounder of AI coding startup Windsurf, as a part of a $2.4 billion expertise deal, and in June named DeepMind alum Koray Kavukcuoglu its first chief AI architect. In the meantime, the corporate provided buyouts to some workers inside its search and adverts division final month—eight months after Alphabet CFO expressed a necessity for cost-cutting as the corporate’s AI investments surge. The corporate mentioned on a name with buyers in February that it plans to spend $75 billion on AI this 12 months. The important thing quotes“We see AI powering an enlargement in how individuals are looking for and accessing info, unlocking utterly new sorts of questions you may ask Google,” Pichai mentioned. “Total queries and industrial queries on Search proceed to develop 12 months over 12 months, and our new AI experiences considerably contributed to this enhance in utilization. We’re additionally seeing that our AI options trigger customers to look extra as they be taught that search can meet extra of their wants. That’s very true for youthful customers.”