Google AI Mode struggles to monetize
The gist
Alphabet shares fell almost 10% after Google said AI Mode searches earn less from ads than traditional search.
The drop erased over $500 billion in market value.
How it unfolded
- Oct 28, 2026Alphabet reported Q3 results: revenue of $127.6 billion, up 25% year over year but below the roughly $128.2 billion analyst consensus, with net income of $26.17 billion and diluted EPS of $2.12.
- Oct 28, 2026Shares fell almost 10% (over 11% in one account) after Google said AI-powered searches earn less from advertising than traditional search, wiping out more than $500 billion in market value.
- Oct 28, 2026On the earnings call, chief business officer Philipp Schindler attributed the Search slowdown to "lower monetization we were seeing in AI Mode."