Despite existential fears that AI chatbots would cannibalize search, Google’s advertising revenue climbed steadily from roughly $52 billion per quarter in early 2023 to approximately $72 billion in Q3 2025, with Q4 2025 projected to approach $80 billion. The golden goose not only survived the AI transition—it grew nearly 50 percent in under three years.
The Cannibalization Thesis Failed
When ChatGPT launched, analysts warned that conversational AI would erode Google’s 90 percent search market share. Instead, quarterly ad revenue grew from $52 billion to nearly $80 billion. Users did not abandon search for chatbots; they use both.
Growth Is Accelerating, Not Decelerating
The slope steepens in 2025:
- Q1 2025: ~$69 billion
- Q3 2025: ~$72 billion
- Q4 2025 (projected): ~$80 billion
The AI Overviews integration appears to be enhancing rather than destroying ad inventory value.
This Funds the AI Arms Race
Each quarter generates $65-80 billion in advertising alone. This cash machine funds TPU development, DeepMind research, and Gemini training runs without external fundraising. OpenAI raises billions from investors; Google prints it quarterly.
The 90% Search Share Remains Intact
Project Magi’s challenge was integrating AI without killing the core business. By this measure, success is definitive. AI-enhanced search generates more revenue, not less.
The Strategic Question
Google successfully navigated the most dangerous transition in its history, integrating generative AI into search without destroying the advertising model. Now the question is whether it can do the same transition for agentic commerce.
Source: Company Filings









