Google Unifies Search And AI Into One Product

Google's recent earnings call has sparked concern among investors, despite the company's revenues being up 25% year-over-year and Cloud revenue increasing by 103%. The main concern is the shift towards AI Mode, which currently has fewer opportunities for ads, resulting in lower-than-expected revenue from Search. However, Search advertising is still up 12% year-over-year, according to Search Engine Journal.

The call emphasized the importance of agentic search, with Google's executives discussing the early days of agents changing Search. The company is prioritizing the user experience and engagement first, then scaling the formats, as stated by Philipp Schindler. Google's goal is to make AI Mode a quality product before focusing on monetizing it.

Google announced that ads in AI Mode are expanding to more countries, including Australia and Canada. The company also mentioned the potential for new connected apps to be offered as ads in the future. Additionally, Google's computing power is in high demand, with the company selling TPU Systems, which combine hardware, computer, storage, networking, and software.

The idea of traditional Search and AI Search merging into one product was mentioned several times during the call. Sundar Pichai stated that Google is building one seamless experience across AI Overviews, AI Mode, and Traditional Search. Philipp Schindler also emphasized the importance of thinking of Search holistically, as a unified product spanning traditional results and AI-powered Search.

Google's vision for AI is not just limited to online agents but also extends to other areas, such as intelligent eyewear and in-home robots. The company's mission is to organize the world's information and make it universally accessible and useful. Google's executives, including Sundar Pichai and Philipp Schindler, expressed excitement about the commercial opportunities ahead and the potential for agentic experiences to bring in new use cases to Search.

The Connected Apps Platform, announced on the day of the call, allows people to use a website's functionality right from Search. This platform has the potential to revolutionize the way people interact with Search and could eventually be offered as ads. Google's Gemini app is also growing rapidly, with one billion users, making it the fastest-growing product in Google's history.

Google's models have not been as advanced as those from OpenAI and Anthropic, but the company is working on improving its coding capabilities. The recent announcement of Gemini 4 Carbon, a new frontier model, is undergoing voluntary testing and will soon be released. Artificial Analysis currently has Carbon listed as the most intelligent model to date, and Sundar Pichai mentioned that more models are coming soon, including more efficient versions to help developers optimize for speed and cost.