Search and other revenue was $63.35bn, up 12 percent on a year but only $79m above the second quarter. Currency cost the whole group $433m over that quarter.
Google's Search queries are growing faster than at any point in five years. Its Search revenue barely moved on the quarter.
Google says currency, retail and media explain most of the slowdown, and lower AI Mode monetisation the rest. Alphabet's own currency table shows currency can cover only a sixth of the gap. The fourth quarter is the first test, and Search needs about $70.6bn to hold 12 percent growth.
Google's explanation
On the 28 October call, JPMorgan's Doug Anmuth asked why Search ad revenue was growing more slowly than queries, Search Engine Journal reported. Chief business officer Philipp Schindler ranked the causes of the slowdown from the second quarter. Currency was "the single largest driver of Search deceleration relative to Q2".
Retail and media came next. Certain Asia Pacific retail advertisers were hit after the EU removed its de minimis exemption. Media spend normalised after a second quarter that included the FIFA World Cup.
Lower AI Mode monetisation came third. Schindler said the strong growth in AI Mode queries had an impact because of the lower monetisation Google was seeing there. In prepared remarks he called many new questions in AI Search upper funnel, meaning early in a buying decision. He said most AI Mode queries are incremental.
Queries are the one measure that did not slow. Alphabet says year on year Search query growth was the highest in the last five years.
The Alphabet results show the effect on revenue. Search and other revenue was $63,350m in the third quarter, up 12.0 percent on a year. Growth was 19.1 percent in the first quarter of 2026 and 16.8 percent in the second.
What the currency figures show
Alphabet's own currency table puts a limit on the first cause. CFO Anat Ashkenazi said currency was a slight headwind year over year and had a more significant impact sequentially.
Across the whole group, exchange rates cost $433m of revenue from the second quarter to the third, or 0.4 percent. If every dollar of it fell on Search, it would still be 0.7 percent of Search revenue. Group revenue rose 6 percent on the quarter as reported and 7 percent in constant currency. Currency therefore moved the group's growth by one point.
The step that did not happen was bigger than currency. Last year Search rose 4.4 percent from the second quarter to the third, from $54,190m to $56,567m. This year it rose 0.12 percent, or $79m.
At last year's step, Search would have earned $66.05bn. That is $2.7bn, or 4.3 percent, above the reported figure. Currency can explain at most a sixth of that gap.
The rest sits with the other causes Google named. Those are retail, media timing and the lower monetisation of AI Mode queries, which Google ranks third.
Search is the slow part of a group growing 25 percent. Total revenue was $127.6bn, and Google Cloud was $30.7bn, up 103 percent. Search, at 12 percent, trails both.
Search still outgrows Google Services as a whole (11 percent), YouTube ads (9 percent) and the Network (1 percent).
How AI Mode ads work
Existing campaigns enter AI Mode automatically. The Google Ads Help page says Search, Shopping and Performance Max campaigns are eligible to serve ads in AI Overviews and AI Mode. Advertisers need no new campaigns and no separate budgets.
Google matches ads to the query and to the AI answer, which suits long, exploratory questions. AI Mode queries are on average three times longer than classic searches, Google says. Exact and phrase match keywords cannot use contextual matching, so broad match and AI Max carry that traffic.
Ads in AI Mode use the same auction as standard Search ads, the Help page says. They use the same cost per click or conversion bidding. Any gain for Google therefore depends on how many of the longer queries carry an ad at all. Pichai said one in five AI Mode searches globally use voice, images or documents.
Sundar Pichai gave the order of priorities in the earnings remarks. "Just like our shift to mobile over a decade ago, we are focused on building the best Search user experience, followed by monetization."
In a post on 28 October, Shashi Thakur named the markets. Google is scaling ads in AI Mode in Australia, Canada, India, Kenya, Malaysia, New Zealand, Nigeria, Pakistan, the Philippines and Singapore. Ads carry a "Sponsored" label.
The Google Ads Help page already lists all ten as places where ads serve in AI Overviews and AI Mode. The post therefore describes scaling, not a first launch. In the fourth quarter, Google plans to add more locales, including Brazil, Mexico and the United Kingdom.
In the US, Google is launching multiturn ads, which serve in follow up questions. Schindler told the call this takes Google's "monetization footprint global for the first time". He added that Google's ad experiments "have shown promising results". Google is now scaling ads within both AI Overviews and AI Mode to more users and queries.
The evidence offered for the launch is American. Google says click through rates on sponsored and organic product listings in AI Mode are "already similar". That rests on internal US data for 20 August to 3 September 2026. The ten markets are the first outside that sample.
The fourth quarter test
The fourth quarter will not be a clean test. Ashkenazi guided to a slightly larger currency headwind, mostly in Search and YouTube ads. She also said Search laps the acceleration that began in the third quarter of 2025, which will pressure growth.
Search revenue rose 9.4 percent from the third quarter to the fourth in 2024 and 11.5 percent in 2025. Applied to $63,350m, those steps give $69.3bn, up 9.9 percent on a year, or $70.6bn, up 12.0 percent.
As of 29 October, Search needs about $70.6bn in the fourth quarter to hold 12 percent growth. A result under $69.3bn would leave currency and lapping short as explanations, because currency was a sixth of the third quarter gap. It would put the weight on AI Mode monetisation, which Google ranks third.