Google Posts $96B in Q2 Revenue,...

The numbers

$96.4 billion — Alphabet’s revenue for Q2, up 14% year-over-year. 

$54.1 billion — Q2 ad revenue generated by Google Search and affiliated properties like Gmail and Google Maps.

$9.8 billion — YouTube’s Q2 advertising revenue, driven primarily by direct response and brand advertising.

450 million — Monthly active users of the Gemini app.

The watercooler talk

It’s AI or bust at Google.

In Q2, the tech giant updated its family of Gemini reasoning models, rolled out a premium $249.99-per-month AI subscription offering, launched its advanced ​​Veo 3 video-generation model and an image-to-video tool embedded within Gemini, and unveiled its browser-based AI agent Project Mariner. 

The company also enhanced AI search with an AI Mode for complex searches and, of course, ads in AI Mode.

During the call with investors, Google CEO Sundar Pichai also touted the growth of AI Overviews, which are AI-generated summaries that appear on top of some search results, noting they now have over 2 million monthly active users globally.

“We know how popular AI Overviews are because they are now driving over 10% more queries globally for the types of queries that show them, and this growth continues to increase over time,” Pichai said.

This traction is necessary, as the company’s search business is facing challengers including OpenAI, Perplexity, and Anthropic, who are chipping away at Google’s dominance in web search. Last month, about 5.6% of all U.S. desktop search traffic was owned by AI engines rather than Google, according to new data from Semrush’s clickstream data company Datos. 

Google has also been shuffling its AI talent as it goes full-throttle on product development.

Earlier this month it snagged Varun Mohan, cofounder of AI coding startup Windsurf, as part of a $2.4 billion talent deal, and in June named DeepMind alum Koray Kavukcuoglu its first chief AI architect. Meanwhile, the company offered buyouts to some employees within its search and ads division last month—eight months after Alphabet CFO expressed a need for cost-cutting as the company’s AI investments surge. 

The company said on a call with investors in February that it plans to spend $75 billion on AI this year. 

The key quotes