Bank of America: Rapid Growth of AI Chat Competitors Difficult to Shake the Search Traffic Foundation of Alphabet Inc. Class C (GOOGL.US)

Bank of America Corp cited Similarweb data in a report stating that despite the ongoing encroachment of generative artificial intelligence (AI) chatbots like Siasun Robot & Automation into the search market, the web traffic for Alphabet Inc. Class C (GOOG.US, GOOGL.US) remains stable. The data shows that in August of this year, Alphabet Inc. Class C's global average daily webpage visits increased by 3% year-on-year, reaching 2.8 billion, while ChatGPT's webpage traffic fell by 5% year-on-year to 181 million. Traffic for Alphabet Inc. Class C's AI chatbot Siasun Robot & Automation Gemini grew by 261% year-on-year, Claude under Anthropic increased by 533%, Meta Platforms (META.US)'s Meta AI saw a growth of 175%, and Grok under SpaceX (SPCX.US) grew by 10%. On a month-over-month basis, Alphabet Inc. Class C's webpage traffic in August remained flat compared to July, while ChatGPT saw a 4% increase, Meta AI grew by 18%, Claude decreased by 1%, and Grok remained flat. Bank of America analyst Justin Post wrote in a report to clients: "In the U.S. market, Alphabet Inc. Class C's webpage visits increased by 3% year-on-year to 534 million; ChatGPT grew by 13% year-on-year (about 6% of Alphabet Inc. Class C's traffic); Gemini increased by 177%; Claude saw a 432% rise; Meta AI was up 109%; and Grok grew by 24%." Month-over-month, Alphabet Inc. Class C's webpage visits in the U.S. remained stable, while ChatGPT grew by 4%, and both Gemini and Claude decreased by 5%, with Grok falling by 2% and Meta AI increasing by 25%. On the mobile front, ChatGPT saw a 37% year-on-year increase in daily active users in August, reaching 469 million, while Alphabet Inc. Class C's daily active users on mobile grew by 12% year-on-year to 2.3 billion. Gemini's daily active users increased by 284% year-on-year to 12.6 million, Claude surged by 1017% to 19 million, Meta AI skyrocketed by 583% to 5 million, and Grok rose by 45% to 9 million. In terms of net growth, Alphabet Inc. Class C added 3 million daily active users in August, while ChatGPT, Gemini, and Claude added 21 million, 7 million, and 400,000, respectively, Grok remained flat, and Meta AI's mobile daily active users declined. Post stated: "The data from August indicates that the traffic and user growth for Alphabet Inc. Class C remain generally stable, while ChatGPT has shown a significant month-over-month increase, likely fueled by the back-to-school season. Overall, the data suggests that the proliferation of AI is expanding the search market, and despite rapidly growing rival platforms, the usage of Alphabet Inc. Class C's search remains stable. Given that ChatGPT now has over 1 billion users, its recently launched advertising business has attracted significant investor attention (with an annualized revenue of 1 billion USD). Considering the size of the Western digital advertising market exceeds 600 billion USD, we expect no substantial impact this year, but investor focus on advertising performance in September and October will significantly intensify."