Google is showcasing strong results in the first quarter of 2026: Search revenues are up 19% year-over-year, and Sundar Pichai attributes this performance directly to artificial intelligence experiences like AI Overviews and AI Mode. This growth raises some questions.

Highlights:

  • Google Search and Others generated $60.4 billion in revenue in the first quarter of 2026, representing a 19% year-over-year increase.
  • Sundar Pichai notes that search queries are at a record level and directly links this to artificial intelligence experiences.
  • Since the transition to Gemini 3, Google has reduced the cost of AI responses by more than 30%.
  • The increase in search revenues does not definitively show whether websites are receiving more or fewer clicks from AI-enhanced results.

Rising Numbers with Artificial Intelligence

Alphabet announced its first-quarter results for 2026, showcasing remarkable performance on the Search side. The Google Search and Others segment generated $60.4 billion in revenue compared to approximately $50.7 billion a year ago, indicating a 19% year-over-year increase. This marks an acceleration compared to the fourth quarter of 2025, when year-over-year growth was 17%, although absolute figures were slightly higher due to seasonality (at $63.1 billion).

On a group basis, Alphabet achieved a total revenue exceeding $109.9 billion, reflecting a 22% increase.

Sales Director Philipp Schindler noted that the published results benefited from favorable currency effects. Growth in constant currency terms is slightly lower than the reported figures.

Pichai's Comments on Search and Artificial Intelligence

Sundar Pichai directly stated to investors: He attributes the strong performance of Search to new artificial intelligence experiences. According to him, users are “returning to Search more,” and queries are reaching record levels.

AI Mode is recording “strong growth in terms of users and usage on a global scale.” Previous data from Google indicated that this feature had 100 million monthly active users and 75 million daily users, but Pichai did not share an updated figure in this presentation.

Google's stance on AI Overviews remains the same: these AI-generated summaries promote the overall growth of Search, rather than detracting from it. Liz Reid, who is responsible for Search at Google, made a similar statement, noting that AI Overviews have reduced low-value clicks but have not harmed useful traffic.

In terms of more concrete growth drivers, Schindler emphasizes that Search's performance in the first quarter was “particularly supported by retail and finance,” and that the healthcare sector also made a significant contribution. “The robustness observed in Search is not due to a single factor, but rather the result of many of our business areas working well together,” he says.

Google Reduced AI Costs by 30%

Pichai shared two notable operational metrics.

  • The first metric: latency. Pichai states that Google has reduced Search's response time by more than 35% over the past five years, including the integration of new AI features into results pages.
  • The second metric, more strategic: since the transition of AI Overviews and AI Mode to Gemini 3, Google has reduced the cost of AI responses by more than 30%. This optimization has been made possible by advancements in hardware and engineering. This is an important signal: the profitability of AI experiences on Search is increasing, making large-scale deployment more economically sustainable.

New Features Rolled Out in the First Quarter

Pichai highlighted three concrete developments in the Search product during the quarter.

  • The Google Personal Intelligence feature was expanded to all free U.S. users in March; this allows for personalized results by integrating personal data (Gmail, Calendar...).
  • Agency experiences were expanded to new countries. Pichai cites restaurant reservations as a concrete example of the vision he calls “Search as an agency manager”; here, Search not only sends links but performs actions on behalf of the user.
  • Search Live was rolled out globally as a multimodal feature that allows real-time searching through the camera.

What These Results Don’t Say

The growth in search revenues and Pichai's comments about record-level queries do not answer a question that has been on the minds of SEO professionals since the emergence of AI-enhanced results: Are websites receiving more or fewer clicks?

Google did not share data regarding click-through rates for AI Overviews or AI Mode. Saying “record-level queries” does not mean “record-level exit clicks.” A user may conduct more searches when their needs are directly met on the results page, while clicking less on third-party sites.

While Google may record an increase in advertising revenues, click patterns may shift towards publishers, sometimes in a downward direction. These two phenomena are not contradictory, and Alphabet did not see the need to provide additional transparency on this matter in this earnings announcement.