Google says ads will survive even when AI does your shopping

Google says ads will still have a place when AI does your shopping. On Alphabet's earnings call on Tuesday, Philipp Schindler, Google's chief business officer, said AI should handle the dull parts of shopping and leave the choosing to people. Sponsored offers, in his telling, would sit inside that choosing step.

What Google said

Schindler said there is a part of shopping people do not like, the "grunt work," which is "fantastic to automate with AI." But Google also wants to "enhance, not just automate away" the discovery people love. He said shoppers do not always want the cheapest option. They also weigh brand loyalty and customer service. Google believes that gives it room to build ads into agentic shopping, where an AI agent acts for you.

The insurance example

Schindler described how it might look. The AI finds an insurance product, then points out another strong option. One has a higher premium, maybe a lower deductible (the amount you pay before coverage starts), and the company is offering a very special discount.

He added that there is almost never a single perfect answer to a shopping decision. That is why Google is "confident" there is room for advertising even in agentic search.

Why Google needs this to work

Agentic search has been a challenge for Google's core ads business. The company said Google's AI Mode has led to more searches than ever, but it is not making money at the same rate. Investors have long argued that AI chatbots and agents threaten Google's search business.

Google has signaled for months that it wants to fix this without simply cramming old-style ads into a chatbot. Last quarter, it said it was testing offers during travel planning and clearly marked sponsored links inside AI-generated lists.

The earnings numbers

Alphabet reported third-quarter revenue of $127.58 billion, narrowly below the $127.97 billion analysts expected. Earnings per share were $2.12, versus roughly $3.01 expected. The gap came largely from an $8.2 billion unrealized loss on its SpaceX investment, meaning a loss on paper. Shares fell about 10% after hours.

What to do

Nothing changes today, but the direction is clear. Expect more labeled offers inside AI shopping answers.

• Look for the sponsored label before you buy from an AI-generated list.
• Compare more than price, such as brand, service and perks.
• Business owners should think about how their offers could appear in AI answers.

It is not yet clear when these ads will reach everyone or exactly what they will look like.