WHAT EXPLAINS GOOGLE'S RECORD QUARTERLY SEARCH REVENUE WHILE CLICKS DECLINE & SITETRAFFIC DROPS?

Summary from the TLDR Marketing newsletter

The introduction of AI Overviews has changed the search funnel by addressing early research queries without requiring user clicks. As a result, fewer users proceed to external sites, but those who do are more likely to convert and are being monetized at higher rates, with CPCs rising nearly 13%. This model has enabled Google to grow search revenue significantly despite reduced traffic to third-party websites.