If Google Ads was a separate company, then the rest of Google wouldn't have an income source. Google is one breadwinner (Ads) + N loss leaders for it.
(They're trying to grow a second revenue generator — GCP — but it's not been the success they've hoped; especially compared to Azure. Microsoft had the B2B relationships already in place, while Google has mostly been a B2C company, so they've been struggling to win clients.)