BofA: AI Wars — Another Big Month for Claude, Strong Gemini Growth Continues
Summaries are public. PDF access requires an active membership; all members have the same access. Sign in
BofA reports that March 2026 showcased intense competition among AI chatbots. Claude experienced a remarkable 90% month-over-month surge in global web traffic, reaching 20 million daily visits, driven by the adoption of Claude Code and agentic features. Gemini continued its strong growth trajectory, with global daily visits rising 8% month-over-month to 84 million and global mobile DAU climbing 9% to 89 million.
Conversely, ChatGPT saw global daily web traffic decline 6% month-over-month to 185 million, though it maintained a significant lead with 427 million mobile DAU. Despite the competitive pressures, Google's core search business remained resilient. Global search share actually ticked up 24 basis points year-over-year to 90.0%, while US search share rose 83 basis points month-over-month to 85.0%.
BofA interprets Claude's explosive growth as primarily incremental to the AI market or cannibalizing other AI competitors rather than materially eroding Google's search dominance. The bank notes that Google's overall traffic continues to grow steadily.
Consequently, BofA maintains a Buy rating on Alphabet (GOOGL/GOOG) with a target price of USD 370, compared to the current price of USD 317.32. Upcoming catalysts include the Cloud Next conference on April 22 and the I/O conference on May 19. Key risks involve elevated valuation multiples and potential launches of competing products like GPT-6 or OpenAI advertising.