GOOG 3Q25: GCP's Path to $100Bn ARR

We have published several reports on GOOG since last quarter.

In our 2Q25 Preview, we analyzed how Google cleverly monetized AI Overview with ads, demonstrating that AI Overview not only had no negative impact but actually created additional ad inventory. We also discussed how AI Overview and AI Mode help Google monetize the >60% of queries that remain uncommercialised.

In our subsequent GOOG report, we analyzed TPU and OCS advantages, and how hardware superiority has enabled Gemini’s cost advantage.

In this report, we observe several interesting developments

1. AI Mode has begun contributing incremental engagement time

2. AI Max, launched in September, is helping Google monetize previously uncommercialised long-tail queries

3. Apple and Anthropic will drive significant GCP growth next year

4. TPU demand is exceptionally strong with highly positive feedback

5. On the negative side, Amazon paused Google ad spend in the US during 3Q25

GOOG Preview