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Tag: Google

AI Is Helping Meta Sell More Ads — While Google Search Growth Slows to 12%
Introduction

Two of the biggest advertising companies in the world just reported very different quarters. Meta’s advertising business is growing fast, helped by artificial intelligence. Google’s search business is still growing, but more slowly — and AI is part of the reason.

What Happened

Meta reported $63.1 billion in advertising revenue for the third quarter of 2026, up 26% from a year earlier. Total company revenue was $64.6 billion, also up 26%. The number of ads people saw rose 10%, and the average price of an ad rose 14%.

Alphabet, Google’s parent company, reported $127.6 billion in total revenue, up 25%. But Google Search and other revenue grew 12% to $63.35 billion. That is solid growth in normal terms, yet it is clearly slower than Meta’s advertising growth — and slower than Google’s own search growth in recent quarters.

Key figures
- Meta advertising revenue: $63.1 billion, up 26%
- Meta ad impressions: up 10%; average ad price: up 14%
- Meta total revenue: $64.6 billion, up 26%
- Google Search and other revenue: $63.35 billion, up 12%
- Alphabet total revenue: $127.6 billion, up 25%
- Google Cloud revenue: $30.71 billion, up 103%
Why It Happened

Meta says AI is making its ads work better. When ads are shown to people who are more likely to be interested, advertisers are willing to pay more, and more of those ads lead to a sale or a sign-up. Meta also pointed to more user engagement across Facebook, Instagram and its other apps.

Google’s story is more mixed. Alphabet said search query growth was the fastest in five years, helped by AI. But more questions do not automatically mean more advertising money. Google’s chief business officer said AI Mode searches — where an AI answer appears instead of a simple list of links — currently bring in less advertising revenue than a traditional search. Foreign exchange was also the largest single factor in the slowdown, the company said.

In plain terms: people are searching more, but the new kind of search is harder to turn into ad money, at least for now.

Why It Matters

Advertising pays for most of what these companies offer for free. If Meta can keep improving ad performance with AI, it has a strong engine for profit, even while it spends heavily on AI data centres. Meta guided fourth-quarter revenue to between $73 billion and $76 billion.

For Google, the question is different. Search is still a huge business — $63.35 billion in one quarter is enormous. But investors are watching closely: can Google make AI search pay as well as old-fashioned search did? Google only started showing ads alongside AI Mode searches worldwide on October 29, so that part of the story is just beginning.

What Happens Next

Watch two things. First, whether Meta’s ad prices keep rising without scaring advertisers away. Second, whether Google’s AI Mode advertising starts to close the gap between fast query growth and slower revenue growth. The next earnings reports will give a clearer answer.

Final Thoughts

AI is not helping every big tech company in the same way. Right now, it is boosting Meta’s core business directly. For Google, AI is bringing more users and more questions, but the money side is still catching up. That difference explains a lot about how these two giants are being judged today.

Related: Why Google Stock Crashed 12.6%: What Investors Need to Know

Disclaimer: This article is for educational and informational purposes only and does not constitute financial advice.

Sources: CNBC, https://www.cnbc.com/2026/11/01/ai-meta-ads-google-search.html ; Meta Q3 2026 results as reported by Exchange4Media, https://www.exchange4media.com/digital-news/metas-ad-revenue-jumps-26-to-631-billion-as-ai-boosts-conversions-ad-prices-159351.html ; Alphabet Q3 2026 results as reported by NeoTeo, https://www.neoteo.com/en/alphabets-q3-2026-results-search-and-cloud-grow-free-cash-flow-is-negative
November 1, 2026
Anthropic’s Road to the Stock Market Just Got Rockier as AI Spending Worries Investors
Introduction

Anthropic, the AI company behind the Claude chatbot, picked a difficult week to head toward the stock market. Just days after it released its IPO prospectus, Microsoft, Google and Amazon reported results that added to investors’ worries about how much money the AI boom is eating up.

What Happened

Anthropic released its IPO prospectus on Monday, October 26, 2026. The document showed a net loss of $80 billion for the first half of the year, hundreds of billions of dollars in future computing commitments, and more than 90 pages of risk factors. The company plans to list on the Nasdaq under the ticker ANT, but it has not yet set a price range, share count or fundraising size.

Then the big tech results landed. Microsoft lowered its capital spending forecast for the year to $170 billion, down from $175 billion. Alphabet, Google’s parent, kept guidance for spending of up to $205 billion. Amazon repeated a forecast of roughly $220 billion. All three figures came in below what analysts had expected, according to CNBC.

Cash flow told an even sharper story. Amazon reported negative free cash flow for a second straight quarter, with a $42.4 billion outflow over the past 12 months. Google reported negative free cash flow of $9.1 billion, and its stock fell almost 13% on Thursday. Microsoft stayed cash-flow positive at $18.6 billion, but that was down sharply for a second straight quarter, and the company announced plans to raise $25 billion in bonds.

The wider market felt it too. The Nasdaq Composite fell 2.9% on Friday, marking its first three-week losing streak since March. Nvidia traded lower, and Intel’s weak forecast sent its stock to its steepest drop since the 1970s.

Related reading: Nasdaq Ends October With Its Worst Month Since March 2025 as Tech Sell-Off Deepens

Why It Happened

Building AI systems is extremely expensive. Companies need huge data centers, powerful chips and enormous amounts of electricity. Anthropic’s prospectus makes that cost visible: hundreds of billions of dollars promised for computing power in the years ahead.

Investors are now asking a simple question: when does all this spending turn into profit? Cloud revenue at Microsoft, Google and Amazon beat analysts’ expectations — Google’s cloud revenue more than doubled from a year earlier — but that was not enough to calm the market. When even strong cloud growth comes with negative cash flow, investors start to worry about how the bills get paid.

The IPO market has also gone quiet. It has largely been frozen since SpaceX’s record offering in June. Other companies, including Oura, Firmus and SK Hynix’s Solidigm unit, have recently delayed or dropped IPO plans. As Futurum Group CEO Daniel Newman put it, “Anthropic is the IPO market at this point.”

Key Figures
- Anthropic: $80 billion net loss in the first half of 2026; $16.3 billion in first-half revenue (per its filing)
- Anthropic: hundreds of billions of dollars in future computing commitments
- Microsoft: capital spending forecast cut to $170 billion from $175 billion; free cash flow $18.6 billion; $25 billion bond plan
- Alphabet: spending guidance up to $205 billion; negative free cash flow of $9.1 billion
- Amazon: spending forecast roughly $220 billion; $42.4 billion free cash outflow over 12 months
- Nasdaq Composite: down 2.9% on Friday, October 30
Why It Matters

Anthropic’s IPO is a test for the whole AI sector. If one of the most important AI companies struggles to convince public investors, it could make fundraising harder for others. It could also force AI companies to show clearer paths to profit instead of just growth.

For ordinary investors, the lesson is about balance. AI is real technology with real revenue growth. But growth funded by massive spending and debt carries risk, and this week showed how quickly excitement can turn into doubt when cash flow goes negative.

What Happens Next

Anthropic still has to fill in the missing pieces of its offering — price, share count and size — and investors are still waiting for its third-quarter financials. Oracle, meanwhile, said it will limit additional fundraising in coming years to $20 billion and turn cash flow positive in the second half of its next fiscal year, a sign that even big AI spenders feel pressure to show discipline.

Watch the next round of results and Anthropic’s pricing decision. If the IPO prices well, it could reopen the market for other tech listings. If it struggles, the freeze could last longer.

Final Thoughts

Anthropic is not in trouble because its technology failed. It is facing a market that has started asking harder questions about AI spending. That is a healthy question, even if it makes the road to the Nasdaq bumpier. The companies that answer it with real cash flow, not just big promises, will be the ones investors trust.

Disclaimer: This article is for educational and informational purposes only and does not constitute financial advice.

Sources: CNBC, “Anthropic’s path to the Nasdaq just got a lot bumpier” (https://www.cnbc.com/2026/10/31/anthropic-ipo-ai-spending.html); Anthropic S-1 filing coverage (revenue of $16.3 billion in H1 2026, Nasdaq ticker ANT).
October 31, 2026
Reddit Shares Drop 20% as AI Search Eats Into Its Traffic
Reddit beat earnings expectations on Thursday, October 29, and its stock still fell hard. Shares dropped about 18% in after-hours trading and were down more than 20% in premarket trading on Friday, October 30.

The reason was not the past quarter. It was a warning about the future, and about how artificial intelligence is changing the way people find information online.

What Happened

Reddit’s third-quarter revenue rose 53% from a year earlier to $895 million, above the roughly $878 million analysts expected. Adjusted earnings came in at $1.40 per share, also above expectations. Advertising revenue grew 54% to $847 million.

Daily active users, the number of people who visit Reddit on an average day, grew 12% to 130.3 million, but that was below the roughly 134 million analysts expected. In the United States, daily users actually fell 2% to 50.7 million, the first decline since Reddit went public in 2024. International users grew 24%, which softened the blow.

For the fourth quarter, Reddit expects revenue of $1.00 billion to $1.03 billion. The middle of that range, $1.015 billion, was below the $1.05 billion analysts had forecast.

But the number that scared investors most was about traffic. Reddit said search referrals, the visitors who arrive by clicking a link in a search engine, fell by more than 1 million per week on average in October. If that pace continues, the company warned, daily users could fall by a low double-digit percentage in the fourth quarter, from the current base of about 130 million.

Why It Happened

Reddit’s chief executive, Steve Huffman, blamed Google’s shift to AI-powered search. When people search for something today, they often get an AI-generated answer at the top of the page, and they never click through to the website. That means fewer visitors for sites like Reddit, even though their content is often used to build those AI answers.

Related reading: Why Google Stock Crashed 12.6%: What Investors Need to Know

Huffman said search referral traffic was down meaningfully in the third quarter, and the decline sped up later in the quarter. He argued that AI search “does not drive traffic, not for us and not to anybody,” and that AI answers cannot replace real communities of people.

Reddit is also changing how its site works. The company plans to test requiring users to log in to see most content, starting in selected markets outside the United States in the fourth quarter. The idea is to reduce data scraping, where other companies collect Reddit’s posts without permission, and to focus on logged-in users, who bring in more than 80% of its advertising money. But a login wall could also put off casual visitors, which is a risk the company will be testing carefully.

Think of it like a public noticeboard in a town square. For years, anyone walking past could read it. Now, the town has built a wall with a gate, and an AI assistant outside summarises the notices for passers-by. Fewer people walk in, even though the notices inside are just as useful.

Key Figures
- Q3 revenue: $895 million, up 53% (expected: about $878 million)
- Q3 adjusted earnings per share: $1.40 (expected: about $1.35)
- Advertising revenue: $847 million, up 54%
- Daily active users: 130.3 million, up 12% (expected: about 134 million)
- US daily users: 50.7 million, down 2%
- Q4 revenue forecast: $1.00 billion to $1.03 billion (expected: about $1.05 billion)
- Search referrals in October: down more than 1 million per week on average
- Possible Q4 user impact: a low double-digit percentage decline if the trend continues
Why It Matters

Reddit’s warning matters far beyond Reddit. If AI search answers keep people from clicking through to websites, every site that depends on search traffic faces the same problem: news publishers, forums, blogs and small businesses. It raises a big question about the internet’s business model. If AI companies use content created by others but send fewer visitors back, how do those creators earn money?

It also matters for Reddit itself. Advertising is its main source of income, and advertisers pay for attention. Fewer visitors, especially in the United States, could mean slower advertising growth, even if revenue is still rising fast today.

What Happens Next

Investors will watch the login test closely. If it protects Reddit’s content without driving users away, it could become a model for other platforms. If it shrinks the audience, the company may need to rethink it. The fourth-quarter user numbers, due early in 2027, will show whether the warning came true.

Reddit also has content licensing deals with Google and OpenAI, which pay for the right to use its posts to train AI systems. Those deals are up for renewal, and the company gave no update on them in this report. How those talks go could matter as much as the traffic numbers.

Final Thoughts

Reddit’s quarter shows a strange new reality: a company can grow revenue by 53% and still lose a fifth of its value in a day, because investors are worried about where its visitors will come from next year. The AI search shift is not just a technology story. It is a business story, and Reddit is one of the first big companies to put a number on what it costs.

Disclaimer: This article is for educational and informational purposes only and does not constitute financial advice.

Sources: CNBC, “Stocks making the biggest moves premarket: Intel, Amazon, Reddit, Chevron & more” (https://www.cnbc.com/2026/10/30/stocks-making-the-biggest-moves-premarket-intc-amzn-rddt-cvx.html); Reuters, “Reddit puts logged in experience first as Google AI hits traffic” (https://mymixfm.com/2026/10/29/reddit-posts-search-traffic-declines-will-push-visitor-sign-ins-to-curb-data-scraping/)
October 30, 2026