Meta Platforms’ advertising revenue grew more than twice as fast as Alphabet’s Google Search & other category in the third quarter, widening a growth gap even as Google queries accelerated.
Meta reported $63.061 billion in advertising revenue for the quarter ended Sept. 30, up 26% from a year earlier. Alphabet reported $63.350 billion in Google Search & other revenue, up 12%. The difference between the growth rates was 14 percentage points. CNBC reported that the spread was the widest since 2021.
Alphabet grouped Search revenue with “other” in its reported figure, so the total does not provide a standalone Search figure. Growth in the category was 17% in the second quarter.
Meta’s Family of Apps ad impressions rose 10%, while the average price per ad increased 14%. The company said its AI work helped boost engagement, refine recommendations and generate more revenue from activity, but did not quantify AI’s separate contribution. Its earlier report on third-quarter ad growth and free cash flow covered the same results from Meta’s perspective.
Alphabet CEO Sundar Pichai credited AI investment with supporting Search queries, including commercial queries. Alphabet said query growth was at its strongest year-over-year pace in five years.
The companies also reported substantial investment costs. Meta’s capital expenditures were $34.91 billion, including principal payments on finance leases, and its free cash flow was negative $2.12 billion. Alphabet said its quarterly capital expenditures totaled $51.4 billion, with most going toward technical infrastructure. Neither company reported how much of that spending went to AI.
CNBC reported that Emarketer analyst Nate Elliott sees a potential threat to Google’s advertising business if competing chatbots help people find information better than Google does. The earnings releases report growth in Google Search & other revenue and query volume, but do not show whether people have switched search services or changed their ad-click behavior.
