Alphabet's third-quarter results showed a slowdown in growth in its core search business. On Oct. 29, CNBC reported that search and other revenue rose 12 percent from a year earlier to about $63 billion but missed market expectations. The segment has come in below forecasts for a second straight quarter.

Google said its rate of increase in search queries was the strongest in the past 5 years. But search revenue growth slowed to 12 percent in the third quarter from 19 percent in the first quarter and 17 percent in the second. Usage rose, but revenue fell short of expectations.

Alphabet executives pointed to exchange rates as the biggest factor behind the slowdown in search revenue. They also said currency headwinds would increase in the fourth quarter. Concerns also resurfaced that the spread of AI chatbots and agents is starting to undermine monetisation of traditional search.

Alphabet shares fell about 10 percent in after-hours trading. Quarterly free cash flow was negative $9 billion, about three times the expected deficit. Free cash flow was also negative $5.9 billion in the second quarter, the first time it had turned negative since the listing.

AI investment results stood out in the cloud business. Google Cloud revenue more than doubled this quarter to about $31 billion. Remaining performance obligations were tallied at about $560 billion, with slightly more than half expected to be recognised as revenue over the next 24 months.

Alphabet kept its outlook for capital expenditures this year at $195 billion to $205 billion. It said spending would rise sharply in 2027. That includes investment in TPUs that compete with Nvidia graphics processing units. Alphabet began selling TPUs to external customers in the second quarter.

AI adoption is also accelerating in the advertising business. Chief Business Officer Philipp Schindler said the company is expanding the Gemini model across its advertising infrastructure. In the third quarter, advertisers created more than 1.5 billion campaign assets using Gemini-based tools, more than 7 times the level a year earlier.

Concerns about slowing search growth remain. UBS said worries about search being encroached upon could come back into focus. Jordan Klein of Mizuho said the search and YouTube figures increased concerns about expanding share for AI and agents. Gil Luria of D.A. Davidson said it is too early to draw conclusions from a single quarter, but it is worth re-examining what agent-based commerce could mean for Google.