BOJ keeps interest rates flat, but flags rate hikes on rising inflation, GDP
Investing.com -- Wells Fargo (NYSE:WFC) forecasts that ChatGPT will capture 30% of the global search advertising market by 2030, translating to approximately $100 billion in annual ad revenue.
The bank expects the total search ad market to grow to around $340 billion by the end of the decade, with ChatGPT emerging as a direct competitor to Google (NASDAQ:GOOGL).
“We project the search ad market to grow at an 8% CAGR from 2025 to 2030, with ChatGPT’s share gains coming largely at Google’s expense,” Wells Fargo analysts led by Ken Gawrelski said in a note.
Currently, ChatGPT accounts for nearly 8% of global search instances but has not yet impacted the search ad market.
The analysts believe that’s poised to change. They think that OpenAI will begin integrating sponsored ads into ChatGPT within the next 12 months, leveraging its massive user base of more than 500 million weekly active users, most of whom use the free tier. Only about 5% are paid subscribers.
“We highlight recent hire of CART CEO and ex-Meta exec Fidji Simo, an expert in digital advertising,” the analysts noted, pointing also to a recent DOJ trial exhibit that referenced OpenAI’s monetization ambitions in the second half of 2025.
Wells Fargo estimates ChatGPT’s share of overall search instances will climb to about 17% by the end of 2025 and approach one-third by 2030. The firm expects ad share gains to trail usage growth in the near term but reach parity by the end of the forecast period.
The analysts draw a parallel with TikTok, which took time to align ad revenue with time spent on its platform.
“In ’22, TikTok expanded its ad rollout and garnered only 8% of digital ad share vs. time spent share of 30%. By ’24, TikTok had narrowed the gap to an estimated 16% of ad share against a stable 30% of time spent,” they noted.
Google’s current dominance—over 90% of the market—is expected to decline to about 60% by 2030.
Analysts warned that “ChatGPT’s foray into search ads could place downward pressure on recently robust (CPC) ad pricing,” with every one-point decline in ad pricing potentially cutting Google’s fiscal 2026 EPS by about 1%.
They also pointed out key catalysts that could accelerate ChatGPT’s market entry, including new distribution deals with handset makers and the upcoming remedy ruling in the U.S. DOJ search case against Google.