Search advertising in the United States statistics & facts

The biggest single format in US digital advertising

Search advertising is the paid listing that appears when someone types a query into a search engine, a shopping site or, increasingly, an AI assistant. Advertisers bid on keywords, pay mostly when a user clicks, and reach people at the moment they are looking for something. That simple idea has made search the most reliable profit engine of the internet economy. In the United States, search advertising generated 114.2 billion US dollars in revenue in 2025, according to the Interactive Advertising Bureau and PwC, up 11.0 percent on the year before and accounting for 38.8 percent of all internet advertising revenue.

Search is no longer just Google. Amazon has built the second-largest search ad business in the country from sponsored product listings on its store, Microsoft sells ads on Bing and inside its Copilot assistant, and retailers such as Walmart run their own search ad networks. Since February 2026 OpenAI has been testing ads inside ChatGPT answers in the United States. At the same time, Google is reshaping its own results page with AI Overviews and AI Mode, changing how often people click on anything at all. This report sets out the data behind the US search advertising market in 2026: its size and growth, how it compares with other formats, who earns the money, what advertisers pay, and how AI is changing the economics of the click. It builds on our coverage of search engine usage and Google.

Search ad revenue reaches 114 billion dollars

The IAB/PwC Internet Advertising Revenue Report is the longest-running measure of US digital ad spending, based on data from the companies that sell advertising. Its latest edition, published in April 2026, shows total US internet advertising revenue of 294.6 billion dollars in 2025, up 13.9 percent. Search accounted for 114.2 billion of that, adding 11.4 billion dollars in a single year.

Up by a third in four years: US search ad revenue climbed from 78.3 billion dollars in 2021 to 114.2 billion in 2025, while total internet advertising rose to 294.6 billion.

Growth has not been smooth. Search revenue rose 7.8 percent in 2022 and just 5.2 percent in 2023 as advertisers cut budgets amid high interest rates and a slowdown in tech and e-commerce spending. It rebounded strongly in 2024, growing 15.9 percent to 102.9 billion dollars, the first time US search revenue passed 100 billion, and then grew 11.0 percent in 2025. The IAB described search growth as stabilising at a healthy level as advertisers adapt their strategies for AI-driven search and spread spending across more channels.

How search compares with other ad formats

Search remains the largest single ad format in the IAB data, ahead of display advertising at 81.6 billion dollars and digital video at 78.0 billion. Digital audio, including podcasts and streaming radio, earned 8.4 billion, and other formats such as classifieds, directories and lead generation 12.5 billion.

Still the biggest slice: search earned 114.2 billion dollars in 2025, or 38.8 percent of US internet advertising revenue.

The IAB also measures revenue by channel, which cuts across formats. Social media platforms earned 117.7 billion dollars in 2025, up 32.6 percent, slightly more than search, and commerce or retail media networks earned 63.4 billion, up 18.0 percent. Much of that retail media revenue is itself search advertising, in the form of sponsored product listings on sites such as Amazon, Walmart and Instacart. Together, social media and search accounted for 78.8 percent of US internet advertising revenue. For the global picture of the social side, see our data on social media ad spend worldwide.

Search grows, but video grows faster

While search is still growing at a double-digit rate, other formats are growing faster. Digital video revenue rose 25.4 percent in 2025, driven by connected TV and short-form video on social platforms, while search grew 11.0 percent, a little below the 13.9 percent growth of the market as a whole.

Video sets the pace: digital video revenue grew 25.4 percent in 2025, more than twice the 11.0 percent growth of search.

This gap is why the share of search in the US ad market has been drifting down slowly for years. It is not that search is shrinking, but that advertisers are adding money faster to channels that build awareness, such as video and social, while search captures demand that already exists. Search is usually the last step before a purchase, which is why marketers treat it as essential even as they spread budgets more widely.

The share of search in the US ad market

On the current IAB methodology, search accounted for 41.4 percent of US internet ad revenue in 2021, 40.2 percent in 2022 and 39.5 percent in 2023. A strong 2024 lifted it slightly to 39.8 percent, before it eased again to 38.8 percent in 2025.

A slow drift: the share of search fell from 41.4 percent of US internet ad revenue in 2021 to 38.8 percent in 2025, as video and social grew faster.

A decline of 2.6 percentage points over four years is modest, and search still earns about a dollar in every 2.6 dollars spent on internet advertising in the United States. But the direction matters for the companies that depend on it. The IAB also reported that the top 10 companies captured 84.1 percent of all US internet ad revenue in 2025, up from 80.8 percent in 2024, a sign that the market is concentrating around the largest platforms, several of which are the main sellers of search ads.

Google, Amazon and Microsoft

Three companies dominate the sale of search ads in the United States. Google is by far the largest. Alphabet does not split out US search revenue, but its total revenue from the United States reached 194.2 billion dollars in 2025, or about 48 percent of its global revenue, and search is its largest business. Worldwide, Google Search and other revenue reached 224.6 billion dollars in 2025.

Google in a league of its own: Google Search earned about 224.6 billion dollars worldwide in 2025, more than three times Amazon advertising and almost fifteen times Microsoft search.

Amazon is the fastest-growing force in search advertising. Its advertising services revenue grew 22 percent to 68.6 billion dollars in 2025 and 24 percent to 17.2 billion in the first quarter of 2026, most of it from sponsored product ads that appear in response to searches on its store. When someone searches for a product, many now start on Amazon rather than Google, and the ads they see there are among the most valuable in digital marketing because they sit right next to the buy button. See our data on Amazon revenue by segment and our Amazon statistics and facts.

According to eMarketer forecasts, the share of Google in US search ad spending is set to fall to 48.5 percent in 2026, the first time in more than 20 years it has been below half, with Amazon taking the largest part of the share Google has lost. In 2021 eMarketer estimated the Google share at 56.8 percent and Amazon at 19 percent, and by 2024 it put Amazon at 22.3 percent. Microsoft, through Bing, Yahoo and its partner network, is the third-largest seller; its worldwide search advertising revenue was about 15.2 billion dollars in fiscal 2026, and Bing held about 8.9 percent of US search engine referrals in August 2026. For how the tech giants compare more broadly, see our analysis of the largest revenue sources of leading tech companies.

Other sellers are growing from a smaller base. Walmart Connect, Instacart, Target, eBay and other retailers sell sponsored listings in their own search results, and Apple sells search ads in the App Store. These retail and app store search ads are a large part of the 63.4 billion dollars of commerce media revenue measured by the IAB, and they compete directly with Google for the budgets of consumer brands.

Retail media: search moves to the store shelf

The fastest-growing part of search advertising does not happen on a search engine at all. Retail media, the ads that retailers sell on their own websites and apps, reached 63.4 billion dollars of US revenue in 2025, up 18.0 percent, according to the IAB, and accounted for 21.5 percent of all US internet advertising. A large share of that money buys sponsored listings in the search results of stores, where a shopper typing a product name is often only a click away from buying it.

Amazon is the leader by a wide margin. eMarketer expects Amazon to command about 56.7 billion dollars of US retail media ad spending in 2026 and forecasts its US ad revenue to grow 17.9 percent in 2026, against 5.6 percent for Google, the slowest of the three largest digital ad sellers. Walmart, Instacart, Target, Kroger and Home Depot have all built retail media networks of their own, many of them selling search ads through self-serve tools that look much like Google Ads. For consumer brands, this means a growing share of the search budget now goes to the stores that sell their products rather than to the search engines that send traffic to them.

Retail search ads are attractive because they are easy to measure. The retailer knows whether an ad led to a sale, so advertisers can see a direct return on spending, something that has become harder on the open web as privacy rules and browser changes limit tracking. That closed-loop measurement is a key reason why retail search has grown faster than traditional search, and why Google has responded by expanding Shopping ads and adding product listings to its AI Mode.

Microsoft, Bing and Copilot

Microsoft is the only other general search engine operator with a meaningful US ad business. Bing held 8.92 percent of US search engine referrals in August 2026, more than three times its global share, and Yahoo, whose search results are powered by Bing, held another 2.74 percent. Together that gives Microsoft advertisers a reach of more than one in ten US searches, concentrated on desktop computers where Windows and the Edge browser set Bing as the default. Microsoft said in April 2026 that Bing had passed 1 billion monthly active users worldwide for the first time.

Microsoft Advertising also places ads inside Copilot, its AI assistant, and across partner sites through syndication. Excluding traffic acquisition costs, its search advertising revenue grew 12 percent in fiscal 2026, faster than the market as a whole. Advertisers often find that Bing clicks cost less than Google clicks for the same keywords, because fewer advertisers compete for them, which makes Microsoft Advertising a common second channel for businesses already running Google campaigns.

What a click costs: CPC by industry

For advertisers, the most important number in search is the cost per click. Across 13,474 US search campaigns analysed by LocaliQ and WordStream between April 2025 and March 2026, the median cost per click on Google Ads was 5.42 dollars, the median click-through rate 6.64 percent, the median conversion rate 8.18 percent and the median cost per lead 66.69 dollars. Ten years earlier, in 2016, the same benchmark series put the average cost per click at 2.32 dollars, so the price of a click has more than doubled in a decade.

Lawyers pay the most: attorneys and legal services paid a median of 9.87 dollars per click, six times as much as arts and entertainment advertisers.

Costs vary widely by industry, because the value of a customer varies. A new legal client, a home renovation job or a dental patient can be worth thousands of dollars, so advertisers in those sectors bid aggressively for a limited number of clicks. Attorneys and legal services had the highest median cost per click at 9.87 dollars, followed by home and home improvement at 8.33 dollars and dentists and dental services at 8.00 dollars. At the other end, arts and entertainment clicks cost a median of 1.63 dollars, restaurants and food 2.05 dollars and travel 2.14 dollars. Year on year, real estate saw the largest increase, up about 27 percent, while education and instruction saw the largest fall, down about 23 percent.

There was one piece of good news for advertisers in the 2026 benchmarks: the median cost per lead fell for the first time in five years, even though the cost per click rose slightly. Better conversion rates, helped by automated bidding and landing page improvements, meant that each dollar spent produced slightly more customers. Rising costs are a structural feature of search, however: as more advertisers compete through automated bidding tools for a relatively fixed number of high-intent searches, the price of each click tends to rise.

Which industries win the most clicks

Click-through rates, the share of people who click an ad after seeing it, also differ sharply by industry. Search ads are unusual in digital advertising because they appear only when someone is actively looking, so click-through rates are far higher than for display or social ads, which usually measure well below 1 percent.

Entertainment clicks most: arts and entertainment ads had a median click-through rate of 12.75 percent, against 5.56 percent for automotive repair and parts.

Industries with high click-through rates tend to be those where searches are specific and ads closely match what people want, such as tickets, travel bookings and financial products. Lower click-through rates are common in services where users compare several providers or look for local reviews first. The overall median click-through rate of 6.64 percent in 2026 is more than three times the 1.91 percent recorded in the 2016 benchmarks, reflecting better ad targeting, richer ad formats with images and extensions, and fewer ads competing for a larger share of the page.

How AI Overviews are changing the click

The biggest change to search advertising in two decades is happening on the results page itself. Google began showing AI Overviews, generated summaries at the top of results, to US users in May 2024, and expanded them rapidly. In a study of 68,879 Google searches by 900 US adults in March 2025, the Pew Research Center found that about 18 percent of searches produced an AI summary. When an AI summary appeared, users clicked on a traditional search result in 8 percent of visits, against 15 percent when there was none, and they clicked on a link inside the summary itself in only 1 percent of visits.

Paid clicks shift: paid CTR on queries with an AI Overview rose from 14.64 to 16.21 percent, while on queries without one it fell from 25.98 to 21.85 percent.

The effect on paid clicks is more complex than on organic results. Seer Interactive, which tracks 5.47 million queries for 53 brands, found that between January 2025 and February 2026 the paid click-through rate on queries that showed an AI Overview actually rose, from 14.64 to 16.21 percent, while on queries without one it fell from 25.98 to 21.85 percent. Organic click-through rates moved the other way, falling 26 percent on AI Overview queries and rising on others. AI Overviews appeared on 36 percent of informational queries but only 8 percent of commercial and 5 percent of transactional queries, which is where most advertising money is spent. For now, that has protected the most valuable part of the search ad market.

Google is also bringing ads into its AI experiences. Ads began appearing in and around AI Overviews for US users in late 2024, and at Google Marketing Live in 2026 it announced new formats for AI Mode, including conversational ads that adapt their wording to each query and ads that appear inside AI-generated recommendation lists. To reach these placements, advertisers must use automated campaign types such as Performance Max and AI Max for Search, which hand more of the targeting and creative decisions to Google. The rise of AI in marketing is covered further in our data on generative AI users and the most impactful marketing technology innovations.

ChatGPT and the new search ad sellers

The arrival of advertising in AI assistants is opening a new front. OpenAI announced in January 2026 that it would test ads in ChatGPT, and the test began on 9 February 2026 for logged-in adult users on the Free and Go tiers in the United States. Paid Pro, Business, Enterprise and Education plans remain ad-free. The ads appear below answers, are clearly labelled, and are matched to the topic of a conversation. OpenAI says ads do not influence the answers ChatGPT gives, that advertisers cannot see conversations, and that ads are not shown to users under 18 or next to sensitive topics such as health and politics. The program expanded to Canada, Australia and New Zealand in March 2026 and to several more countries by August.

Other AI companies have taken different paths. Perplexity experimented with sponsored follow-up questions but moved away from advertising, focusing on subscriptions. Microsoft shows ads inside Copilot answers, drawing on its Bing advertising network. For advertisers, these AI placements are still small compared with traditional search, but they matter because they sit where a growing share of product research now happens. With ChatGPT reaching 900 million weekly users worldwide in early 2026, even a small share of queries carrying ads could become a significant new source of search-style advertising.

The Google search ad machine

Google remains the center of the US search advertising market. Its search business has kept growing despite predictions that AI would erode it: in the second quarter of 2026, Google Search and other revenue rose 17 percent year on year to 63.3 billion dollars worldwide, one of its fastest rates in recent years, and the company said AI features were driving an increase in overall search queries. Its advantage rests on scale, the richness of its advertiser tools, and default placement on most browsers and phones. Our data on Alphabet annual revenue and our comparison of Apple and Google revenues show how search underpins the wider business.

That dominance is now under legal constraint. In August 2024 a US federal court ruled that Google had illegally maintained a monopoly in general search services and search text advertising. The remedies decision of September 2025, formalised in December 2025, banned exclusive default agreements, required them to be renegotiated at least annually and ordered Google to share some search data with qualified rivals for six years, though it did not force the sale of Chrome. Both Google and the Department of Justice have appealed. A separate federal court found in 2025 that Google had monopolised parts of the advertising technology market used for display ads. These cases could gradually give rivals more room in the search ad market over the coming years.

The future of US search advertising

Search advertising in the United States is entering a period of change unlike anything since the smartphone. The money is still growing, and search will almost certainly remain the largest or second-largest ad format for years to come. But the places where search ads run are multiplying, from Google and Bing to Amazon, Walmart, app stores and AI assistants, and the format itself is shifting from a list of text links to conversational answers with sponsored suggestions.

Three trends will shape the next few years. First, retail search will keep taking share, because ads next to the buy button are the easiest to measure. Second, automation will deepen, as Google, Microsoft and Amazon push advertisers toward AI-driven campaigns that choose keywords, bids and creative on their behalf. Third, AI answers will change how value is measured, as fewer searches produce clicks and more brands compete to be mentioned inside the answer itself. For advertisers, the lesson is that search budgets now need to follow intent across every platform where people ask questions, not just the classic results page. Readers can explore more in our coverage of internet company revenue, big tech revenue comparisons and average advertising revenue per user at Facebook, the main rival to search for digital ad budgets, alongside our social media statistics and facts and our estimate of the global AI market size.

US search advertising in numbers

A few figures capture the state of the market.

They describe a market that is still growing strongly, but one in which the leader is slowly losing share to retailers and new AI platforms.

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