ChatGPT continues steady gains in search market, Wells Fargo says

Wells Fargo's August 2025 Consumer AI Agent Monitor indicates ChatGPT continues to expand its global and U.S. search market share, gaining 60 basis points and 100 basis points month-over-month respectively in July. This consistent growth is pressuring Google, which experienced accelerated U.S. share loss and stagnant Gemini AI adoption at 0.9%, despite its overall usage growth. With AI agents now holding 12.1% of global search share, Wells Fargo anticipates Google will need to fully integrate its AI Mode by early 2026 to counter this trend, expecting further accelerated share gains for AI agents following major OpenAI launches.

Analysis

According to a Wells Fargo report, ChatGPT continues to capture search market share, with its global instance share increasing by 60 basis points and its U.S. share accelerating by 100 basis points month-over-month in July. This persistent gain highlights a structural shift in user behavior, contributing to a significant competitive challenge for Google. While Google’s overall global usage grew approximately 10% year-over-year, it experienced accelerated U.S. market share loss. The data indicates AI agents now hold 12.1% of the global search market, while Google's traditional search share has declined to 88%, a drop of 10 percentage points from July 2024. Furthermore, Google's proprietary AI, Gemini, has seen stagnant adoption, holding a share of just 0.9%, which Wells Fargo describes as 'disappointing'. The bank suggests this consistent share loss necessitates more aggressive action from Google, whose plan to fully integrate its AI Mode into the main search bar is not expected until early 2026, potentially allowing competitors to solidify their positions further.

Key Decisions for Investors

• Investors in Alphabet (GOOGL) should closely monitor the ongoing market share erosion in its core search business and the notably slow adoption of its Gemini AI, as these factors represent a significant long-term risk to its primary revenue stream.
• The sustained growth of ChatGPT validates Microsoft's (MSFT) strategic investment in OpenAI, suggesting a strong competitive advantage in the burgeoning AI agent market that could serve as a long-term catalyst.
• Given that AI agents have captured 12.1% of the global search market in a year, it is prudent to reassess the entire digital advertising ecosystem, as the shift from traditional to AI-driven search could fundamentally alter market dynamics and monetization models.