Google is in the business of utilising your data in the interest of advertising. No matter how you sugar coat it, the core of the business is tracking people and exploiting that data.
Are they doing their best to be careful and ethical? It sure seems like it, but that doesn't solve the issue.
The free services they and many tech companies provide for free are just payment for your data. The majority of people don't realise this implicit connection and many others do realise it but are happy with the transaction. But it's important to note that they undermine the ability to provide these services more ethically by setting a social norm of incredible services that are "free".
Edit: I will add that the cost and benefit to society of this kind of service provision is complex and nuanced, Google has obviously provided incredible value and society has decided that advertising is a fair price to pay, else they wouldn't be around still. But the true effects of immense tracking and advertising are still yet to play out completely.