Google Faces Pressure as Apple Explores AI-Powered Search for Safari

Mountain View, California — Google is experiencing stock pressure as Apple considers adding AI-powered search engines to its Safari browser. The news comes after comments made by Eddy Cue, Apple’s senior vice president of services, during Google’s antitrust trial.

On Wednesday, Cue revealed that the search functionality within Safari saw a decline for the first time in April, attributing this shift to the increasing use of AI tools by consumers. He mentioned that Apple is “actively looking at” incorporating AI search options, such as those from Microsoft-backed OpenAI, Perplexity AI, and Anthropic PBC.

During his testimony in the U.S. Justice Department‘s lawsuit against Alphabet, which includes Google’s alleged monopoly in online search, Cue expressed concerns about the financial implications of a potential shift in search capabilities. He indicated that while Apple may eventually replace standard search engines with AI options, he believes Google should remain the default search engine in Safari due to significant revenue implications from their existing partnership.

This partnership reportedly generates an estimated $20 billion annually for Google. Cue acknowledged his anxiety regarding potential revenue loss from this deal due to shifts toward AI-powered searches.

Simultaneously, the U.S. Department of Justice proposed divestitures of Google’s AdX digital ad marketplace following a ruling that found the company illegally dominated two ad-tech markets. U.S. District Judge Leonie Brinkema‘s findings reinforce the pressure on Google from both legal challenges and shifting consumer preferences.

As of late morning trading, Alphabet shares dropped nearly 6%, trading at $153.93, while Apple’s stocks also fell by more than 2%, settling at $194.26. The evolving landscape raises questions about Google’s ability to adapt without compromising its lucrative ad revenue model.

Wall Street remains optimistic about Alphabet’s long-term prospects, maintaining a Strong Buy rating amid these industry shifts.