Google Search Revenue Growth Intact Despite AI Competition, Says Evercore's Mark Mahaney

Google Search Resilience

• 💡 Google's search revenue growth remains consistent at low double digits, performing better than expected for the last seven quarters.
• ⚠️ Despite news concerning the Safari browser, Google states that query growth is still positive, even from Apple devices.
• 🎯 The potential decline in Safari search queries might reflect Safari's market share losses rather than a direct impact on Google's core business.

AI's Impact on Search

• 🚀 The emergence of ChatGPT and other AI competitors like Perplexity and Anthropic is raising investor anxiety.
• 🧠 Google is strategically integrating AI, such as AI Overviews and Gemini 2.5 Pro, to avoid cannibalizing its existing search business.
• ⏳ There's a concern that Google may not have as much time as anticipated to experiment with AI integrations due to the rapid pace of competition.
• 📈 Google is demonstrating faster AI development and integration than seen in years, with Gemini 2.5 Pro topping leaderboards.

Future Outlook and Investment Opportunity

• 🎯 Google's search business is considered mature but sustainable, with potential for low single-digit percent query growth.
• 💰 Improving search quality for both consumers and advertisers is expected to drive higher bids for search leads, supporting revenue.
• 📊 The stock is viewed as a dislocated, high-quality opportunity at 15 times earnings, considering Google's diverse assets including YouTube, Google Cloud, and Waymo.
• 📈 Google possesses significant resources, including $100 billion in cash, and is actively buying back stock and managing expenses.