Google's advertising revenue grows as AI reshapes search results
In the second quarter, advertising revenues rose 10.4% year-on-year to $71.3 billion, the company reported on Wednesday, slightly exceeding analysts' expectations.
Google and Alphabet chief executive Sundar Pichai said AI was "positively impacting every part of the business," highlighting new AI-powered features like AI Overviews and AI Mode that are enhancing user engagement.
Google's advertising business is under close scrutiny as the company increasingly integrates AI-generated summaries into its search engine to directly answer user queries.
This could reduce the incentive for users to click on links next to the search results, which is how Google generates revenue.
Overall, Alphabet's total revenue increased 14% to $96.4 billion, beating market forecasts. Net income rose more than 19% to $28.2 billion.
Alphabet's shares fell about 1.5% in after-hours trading following the results. – dpa
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
an hour ago
- The Star
‘Muted, uneven' recovery for semicon industry
PETALING JAYA: Local semiconductor players continue to navigate a period of heightened uncertainty as a convergence of tariff and trade uncertainty, supply chain dynamics and foreign-exchange (forex) volatility continue to cloud the outlook for the sector. Fortress Capital Asset Management Sdn Bhd chief executive officer Thomas Yong said the industry is likely to experience a period of 'muted and uneven recovery' in the next two to three quarters. In particular, factory utilisation rates in segments tied to consumer electronics may remain muted, and earnings for the second quarter of 2025 (2Q25) is expected to be 'relatively stagnant on a sequential basis'. 'The market would remain volatile, reacting sharply to news related to US-China trade policies, tariff deadlines, and macroeconomic data prints. This period will test investor patience,' he told StarBiz. Yong added that there is a bifurcation in demand in the chip industry, where the artificial intelligence (AI) and data centre markets are 'booming' while the recovery in consumer electronics like smartphones and personal computers remains 'tepid and fragile'. He opined that in such a market Malaysian semiconductor companies should adopt a dual-pronged approach to their capital allocation. 'Players must simultaneously modernise their core, established businesses while selectively and strategically invest in the future growth engines outlined by the National Semiconductor Strategy. 'Take our local outsourced semiconductor assembly and test (OSAT) industry as an example. 'The actionable strategy for local OSAT players is to prioritise capital expenditure (capex) towards acquiring and mastering the capabilities for advanced chip packaging, that is, 2.5D and 3D packaging, fan-out wafer-level packaging, and system-in-package integration,' Yong said. In such a way, companies can position themselves to capture high-margin, high-volume business directly from the world's leading fabless AI chip designers. Fortress Capital's Yong said local players are facing 'significant' margin compression. Notably, a combination of lower-than-optimal production run rate, rising operational costs, including higher electricity tariffs and increased labour expenses driven by a fierce talent war, is squeezing profitability. 'This is compounded by currency effects, as a strengthening ringgit against the US dollar can temper the earnings of export-oriented firms,' he said. Nonetheless, UOB Kay Hian wealth advisor's head of investment research Mohd Sedek Jantan said the uncertainty surrounding US trade policy still stands out as the foremost risk to growth for the domestic semiconductor space. Last week, blue chip semiconductor company Vitrox Corp Bhd was downgraded by analysts following the company's second-quarter earnings announcement. 'Sell' calls for the automated test equipment (ATE) company now outweigh the 'buy' and 'hold' ratings. Hong Leong Investment Bank (HLIB) Research downgraded its call for ViTrox to a 'sell' from a 'hold' with an unchanged target price of RM2.65, derived based on price-to-earnings (PE) multiple of 34 times of the financial year 2026 (FY26) earnings per share. The research house said forex volatility, higher reciprocal tariffs from the United States, and component shortages could weigh on ViTrox's near-term margins. HLIB Research said since ViTrox's 1Q25 results, its share price has surged by 40% amid a strong rebound in sentiment for the technology sector, and that the company's current valuation at 48.5 times FY26 PE 'appears stretched', considering 'lingering demand risks from US tariff uncertainties'. Mohd Sedek is of the view that the risks in Malaysia's semiconductor sector are not yet fully priced in. While certain market and policy concerns have been reflected in valuations, several emerging and persistent risks – particularly related to trade policy, regulatory developments, and supply chain dynamics – remain underappreciated by investors, he noted. Mohd Sedek said operationally, while margin pressures from higher labour levies and escalating selling, general and administrative costs persist – particularly for OSAT and ATE players – valuations have adjusted. 'OSATs are currently trading around one standard deviation below their five-year average, with ATEs closer to two standard deviations below. 'This suggests that some risks have been recognised by the market, yet not all fully accounted for – especially considering the complex global and policy environment,' he said. Mohd Sedek cautioned that potential US legislative changes, such as the proposed One Big Beautiful Bill Act, could introduce further compliance burdens for semiconductor firms, particularly around supply chain transparency and technology transfer. He added that supply chain risks, particularly stemming from the US Section 232 investigations into semiconductors and critical minerals, also warrant attention. 'Possible tariffs or trade restrictions could disrupt Malaysia's access to vital inputs like rare earths, which are heavily sourced from China, as well as critical minerals supplied via regional partners such as Indonesia and Vietnam,' Mohd Sedek said. On top of country-specific reciprocal tariffs, the Trump administration has signalled since April that a special tariff rate will be applied to sectors like semiconductors. The United States is currently weighing on the tariff rate for the sector, pending the outcome of its ongoing Section 232 'national security' investigation. Competitive pressures also remain a structural challenge for the local chip sector. Mohd Sedek says Malaysia's 13% share of the global chip packaging market faces growing competition from Vietnam, India, and China – markets benefitting from aggressive expansion strategies and, in some cases, state support. This is also echoed by Yong that intensifying regional competition 'cannot be ignored'. 'Malaysia is not the sole beneficiary of global supply chain diversification. 'Vietnam, in particular, is aggressively courting foreign direct investment with attractive tax incentives and a national chip strategy of its own. Thailand also remains a formidable competitor, especially in the automotive semiconductor space. Complacency is a luxury we cannot afford,' Yong said. Mohd Sedek shared its base case projects a sector earnings contraction of about 2.7% in 2025, underscoring a challenging environment marked by slowing demand, regulatory hurdles, and macroeconomic uncertainties. Despite these near term challenges, experts say the long-term upside potential of the sector is 'compelling'. Yong said recovery is expected to broaden and accelerate into 2026 as inventories normalise and new investment cycles begin. He opined that the 'most significant tailwind' is the structural, multi-decade shift to de-risk global technology supply chains away from a single point of geographic concentration. He stated that Malaysia's 50-year track record, its well-established ecosystem, skilled workforce, and valued geopolitical neutrality make it a prime destination for 'China+1' and 'friend-shoring' strategies by American, European, and even Chinese firms seeking a stable, high-capability manufacturing base. 'This is not a cyclical trend that will fade; it is a fundamental realignment of global capital flows that will benefit Malaysia for years to come,' he said. Yong also believes that the country can capture the AI 'spillover' effect in that while Malaysia may not be designing the next-generation graphic processing units from scratch, the immense complexity of AI systems however, requires massive investment in what happens after the silicon wafer is fabricated: advanced packaging, highly sophisticated testing, and the manufacturing of the automated equipment that performs these critical tasks. 'Arguably, Malaysia already has the foundation necessary to capture such spillover,' he said. Mohd Sedek also echoed Yong's sentiment, noting that the structural drivers of digitalisation, 5G deployment, AI adoption, and data centre expansion are expected to reinforce Putrajaya's role within the global semiconductor supply chain. 'Infrastructure-led growth and regional mega-projects create meaningful opportunities for firms directly engaged in these emerging ecosystems,' he said. According to Mohd Sedek, technology remains a core investment theme for 2H25, and investors can focus on companies with strong exposure to high-growth segments like AI, 5G, and data centre components. He highlighted the importance of prioritising firms with sound forex hedging strategies and diversified revenue streams. 'To mitigate cyclicality risks, investors could pair semiconductor exposure with defensive sectors, while also have a long-term strategic view through anchor investments on long-term technology megatrends – recognising the sector's critical role in global digitalisation and supply chain realignment,' Mohd Sedek said.
The Star
2 hours ago
- The Star
Meta clashes with Apple, Google over age check legislation
The biggest tech companies are warring over who's responsible for children's safety online, with billions of dollars in fines on the line as states rapidly pass conflicting laws requiring companies to verify users' ages. The struggle has pitted Meta Platforms Inc and other app developers against Apple Inc and Alphabet Inc's Google, the world's largest app stores. Lobbyists for both sides are moving from state to state, working to water down or redirect the legislation to minimize their clients' risks. This year alone, at least three states – Utah, Texas and Louisiana – passed legislation requiring tech companies to authenticate users' ages, secure parental consent for anyone under 18 and ensure minors are protected from potentially harmful digital experiences. Now, lobbyists for all three companies are flooding into South Carolina and Ohio, the next possible states to consider such legislation. The debate has taken on new importance after the Supreme Court this summer ruled age verification laws are constitutional in some instances. A tech group on Wednesday petitioned the Supreme Court to block a social media age verification law in Mississippi, teeing up a highly consequential decision in the next few weeks. Child advocates say holding tech companies responsible for verifying the ages of their users is key to creating a safer online experience for minors. Parents and advocates have alleged the social media platforms funnel children into unsafe and toxic online spaces, exposing young people to harmful content about self harm, eating disorders, drug abuse and more. Blame game Meta supporters argue the app stores should be responsible for figuring out whether minors are accessing inappropriate content, comparing the app store to a liquor store that checks patrons' IDs. Apple and Google, meanwhile, argue age verification laws violate children's privacy and argue the individual apps are better-positioned to do age checks. Apple said it's more accurate to describe the app store as a mall and Meta as the liquor store. The three new state laws put the responsibility on app stores, signaling Meta's arguments are gaining traction. The company lobbied in support of the Utah and Louisiana laws putting the onus on Apple and Google for tracking their users' ages. Similar Meta-backed proposals have been introduced in 20 states. Federal legislation proposed by Republican Senator Mike Lee of Utah would hold the app stores accountable for verifying users' ages. Still, Meta's track record in its state campaigns is mixed. At least eight states have passed laws since 2024 forcing social media platforms to verify users' ages and protect minors online. Apple and Google have mobilized dozens of lobbyists across those states to argue that Meta is shirking responsibility for protecting children. "We see the legislation being pushed by Meta as an effort to offload their own responsibilities to keep kids safe,' said Google spokesperson Danielle Cohen. "These proposals introduce new risks to the privacy of minors, without actually addressing the harms that are inspiring lawmakers to act.' Meta spokesperson Rachel Holland countered that the company is supporting the approach favored by parents who want to keep their children safe online. "Parents want a one-stop-shop to oversee their teen's online lives and 80% of American parents and bipartisan lawmakers across 20 states and the federal government agree that app stores are best positioned to provide this,' Holland said. As the regulation patchwork continues to take shape, the companies have each taken voluntary steps to protect children online. Meta has implemented new protections to restrict teens from accessing "sensitive' content, like posts related to suicide, self-harm and eating disorders. Apple created "Child Accounts,' which give parents more control over their children's' online activity. At Apple, spokesperson Peter Ajemian said it "soon will release our new age assurance feature that empowers parents to share their child's age range with apps without disclosing sensitive information.' Splintered groups As the lobbying battle over age verification heats up, influential big tech groups are splintering and new ones emerging. Meta last year left Chamber of Progress, a liberal-leaning tech group that counts Apple and Google as members. Since then, the chamber, which is led by a former Google lobbyist and brands itself as the Democratic-aligned voice for the tech industry, has grown more aggressive in its advocacy against all age verification bills. "I understand the temptation within a company to try to redirect policymakers towards the company's rivals, but ultimately most legislators don't want to intervene in a squabble between big tech giants,' said Chamber of Progress CEO Adam Kovacevich. Meta tried unsuccessfully to convince another major tech trade group, the Computer & Communications Industry Association, to stop working against bills Meta supports, two people familiar with the dynamics said. Meta, a CCIA member, acknowledged it doesn't always agree with the association. Meta is also still a member of NetChoice, which opposes all age verification laws no matter who's responsible. The group currently has 10 active lawsuits on the matter, including battling some of Meta's preferred laws. The disagreements have prompted some of the companies to form entirely new lobbying outfits. Meta in April teamed up with Spotify Technology SA and Match Group Inc to launch a coalition aimed at taking on Apple and Google, including over the issue of age verification. Competing campaigns Meta is also helping to fund the Digital Childhood Alliance, a coalition of conservative groups leading efforts to pass app-store age verification, according to three people familiar with the funding. Neither the Digital Childhood Alliance nor Meta responded directly to questions about whether Meta is funding the group. But Meta said it has collaborated with Digital Childhood Alliance. The group's executive director, Casey Stefanski, said it includes more than 100 organizations and child safety advocates who are pushing for more legislation that puts responsibility on the app stores. Stefanski said the Digital Childhood Alliance has met with Google "several times' to share their concerns about the app store in recent months. The App Association, a group backed by Apple, has been running ads in Texas, Alabama, Louisiana and Ohio arguing that the app store age verification bills are backed by porn websites and companies. The adult entertainment industry's main lobby said it is not pushing for the bills; pornography is mostly banned from app stores. "This one-size fits all approach is built to solve problems social media platforms have with their systems while making our members, small tech companies and app developers, collateral damage,' said App Association spokesperson Jack Fleming. In South Carolina and Ohio, there are competing proposals placing different levels of responsibility on the app stores and developers. That could end with more stringent legislation that makes neither side happy. "When big tech acts as a monolith, that's when things die,' said Joel Thayer, a supporter of the app store age verification bills. "But when they start breaking up that concentration of influence, all the sudden good things start happening because the reality is, these guys are just a hair's breath away from eating each other alive.' – Bloomberg
Malay Mail
6 hours ago
- Malay Mail
HKSTP Takes Nine Game-Changing AI Tech Ventures to WAIC 2025 to Advance China's AI Plus Vision in Transforming Business and Industry
HKSTP is embarking on a mission to advance China's AI Plus vision with nine Hong Kong AI park companies at the WAIC 2025. Hong Kong Space Robotics and Energy Centre Limited (HKSRE ) is an InnoHK R&D centre focuses on aerospace technology R&D to foster international collaboration for the Chang'e-8 mission. It brings together institutions from local and overseas to jointly develop the mission's Hong Kong-operated robot—a multifunctional lunar surface operations and mobile charging system. ) is an InnoHK R&D centre focuses on aerospace technology R&D to foster international collaboration for the Chang'e-8 mission. It brings together institutions from local and overseas to jointly develop the mission's Hong Kong-operated robot—a multifunctional lunar surface operations and mobile charging system. Centre for Artificial Intelligence and Robotics ( CAIR ) Hong Kong Institute of Science & Innovation Chinese Academy of Sciences is another InnoHK R&D centre, showcases MicroNeuro, the world's first flexible robotic system for minimally invasive neurosurgery to address challenges of fragile brain tissue and confined spaces, surpassing human surgical limits. ( ) is another InnoHK R&D centre, showcases MicroNeuro, the world's first flexible robotic system for minimally invasive neurosurgery to address challenges of fragile brain tissue and confined spaces, surpassing human surgical limits. Digital Domain, a global leader in Hollywood visual effects and AI virtual human technologies, showcases the AI-powered video creation solution "HANBAO" and "AI DOMAIN", an all-in-one content creation platform, empowering creators to tailor high-quality short videos for online platforms. Digital Domain has set up its state-of-the-art R&D centre in Hong Kong, driving the innovative development among entertainment and cross-industry. Centre for Artificial Intelligence and Robotics, Hong Kong Institute of Science & Innovation, Chinese Academy of Sciences (CAIR) ClusterTech Limited Digital Domain Hong Kong Centre for Cerebro-cardiovascular Health Engineering (COCHE) HK INBOT TECHNOLOGY LIMITED Hong Kong Space Robotics and Energy Centre Limited MattVerse Limited Metapool Technology Limited Ultipa Hong Kong Limited HONG KONG SAR / SHANGHAI, CHINA - Media OutReach Newswire - 27 July 2025 - Hong Kong Science and Technology Parks Corporation (HKSTP) is embarking on a mission to advance China's AI Plus vision with nine Hong Kong AI park companies at the World AI Conference & High-Level Meeting on Global AI Governance (WAIC) 2025, taking place from July 26-29 in Shanghai, China. In collaboration with the Hong Kong Trade Development Council and Cyberport, HKSTP is leveraging Hong Kong's growing global AI innovation hub status to advance the China's strategic AI initiative and applying AI and big data to transform old and new industry sectors to boost a new era of growth."Hong Kong is a crucible for world-class AI innovation and our unique HKSTP ecosystem provides an ideal platform to empower AI tech firms with global fluency and pave the way for global expansion. By taking local tech companies on a global growth journey and attracting more international startups to land Hong Kong and integrating into the Mainland China or even the Asia markets means a growing critical mass of world-class AI innovators is created. This influx of global talent and technology will accelerate the country's high-tech industry and economic development, further fueling the national drive for new quality productive forces."The nine park enterprises participating in the Hong Kong Pavilion cover technologies in life and health tech, fintech, entertainment, aerospace tech, digital education and more, highlights included:In addition to the showcase of tech firms, HKSTP also hosted a provoking panel discussion at WAIC 2025, exploring the theme of: "From Hong Kong to global impact: Shaping the future with AI and New Quality Productive Forces for Cross-industry Growth", moderated by Ms Pheona Kan, Director of Business Development at HKSTP with the fellow scientists and experts from the discussion highlighted how Hong Kong has a unique role in global AI development by uniting international talent and technology behind the city's AI vision which also aligns with China's vision to transform industry through quality productive the largest I&T ecosystem in Hong Kong, HKSTP is home to over 500 AI startups, including home-grown unicorns that are shaping the future of artificial intelligence. In alignment with Hong Kong's bold vision for technological leadership, the HKSTP San Tin Technopole Campus—a 20-hectare site within the soon-to-be-built San Tin Technopole—will serve as a critical catalyst for the city's next wave of innovation. Strategically located in the heart of the Northern Metropolis, the Campus is poised to become a flagship landmark for AI+ and beyond, aiming to promote its widespread development and application across year, WAIC 2025, themed "Global Solidarity in the AI Era," will bring together top scientists, global leaders, entrepreneurs, policymakers, and innovators in the AI participation at WAIC 2025 is a testament to Hong Kong's role as a bridge between Chinese and global innovators, fostering collaboration and exchange of ideas, technologies, and governance #HKSTP The issuer is solely responsible for the content of this announcement. About Hong Kong Science and Technology Parks Corporation Hong Kong Science and Technology Parks Corporation (HKSTP) was established in 2001 to create a thriving I&T ecosystem grooming 13 unicorns, more than 15,000 research professionals and over 2,300 technology companies from 26 countries and regions focused on developing healthtech, AI and robotics, fintech and smart city technologies, etc. Our growing innovation ecosystem offers comprehensive support to attract and nurture talent, accelerate and commercialise innovation for technology ventures, with the I&T journey built around our key locations of Hong Kong Science Park in Pak Shek Kok, InnoCentre in Kowloon Tong and three modern InnoParks in Tai Po, Tseung Kwan O and Yuen Long realising a vision of new industrialisation for Hong Kong, where sectors including advanced manufacturing, micro-electronics and biotechnology are being reimagined. Hong Kong Science Park Shenzhen Branch in Futian, Shenzhen plays positive roles in connecting the world and the mainland with our proximity, strengthening cross-border exchange to bring advantages in attracting global talent and allowing possibilities for the development of technology companies in seven key areas: Medtech, big data and AI, robotics, new materials, microelectronics, fintech and sustainability, with both dry and wet laboratories, co-working space, conference and exhibition facilities, and more. Through our R&D infrastructure, startup support and enterprise services, commercialisation and investment expertise, partnership networks and talent traction, HKSTP continues to contribute in establishing I&T as a pillar of growth for Hong Kong. More information about HKSTP is available at
