It’s their intentional change which hasn’t yet quite work out as they planned for now and is currently in a bugged state. However, if their change wouldn’t result in bugs, broken lists, empty pages and a looped More by this dev list - still, we would see our downloads decrease.
Here is a screenshot of their official response:

What’s important is their intent. It’s not going to change in the near future at least. And it’s logical and follows the example of Apple. And we’ve seen how it played out with Apple. E.g. I got dozens of apps rejected, and dozens removed from the store. I have heard from several developers independently that dealing with Apple has become a nuisance for them. In a call with their representative, the Apple guy hinted that they take former Steam as boutique store as an example. Basically, less trash on the store, more hand-picked stuff. And a proper inventory worthy of people who’ve bought an expensive, elite device. Well, he didn’t say exactly that - I kind of asked him if that’s what they want, and he kinda confirmed. You know, an Apple person can’t official say such stuff, they need to stay polite and politically correct. By the end of the call, I understood that there is basically nothing I, as a single dev, can offer to their store that they would really want to accept. Or at least it should be a game I spend years on development of (like a Steam-targeted PC game), yet it should monetize on in-apps. But then you need a working monetization model, with a server, in-game economy and live support - basically, a company with employees. Also, as years have proved, this only works for a narrow subset of genres which not every indie likes or respects.
So, now Google is on the same road. I bet that in the first half of 2018 alone they’ve got 1m (or even more) new apps uploaded. By the end of 2018 it could well be 2m, if not 2.5m new apps. It’s like a big “garbage explosion”, with thousands of sweatshops and bedroom coders springing up and using the Unity Asset Store to buy cheap templates and publish easy asset flips, multiple studios re-skinning and re-skinning stuff. Multiple studios publishing stuff to quickly sell it on Flippa (check that online auction and what’s being sold there to get the idea). Multiple investors buying up garbage en-masse and inserting triple interstitials to force you make an accidental click on the ad. Etc etc… The same avalanche has hit Steam btw…
Google has hired armies of people to process updates and check new submitted apps. They apparently test the app completely every time you update anything, even just add a space character to the end of the description. Imagine how much it costs to Google to manage a single app on the store. Multiply that by 4-5m (and rising)…
Then someone at Google thought: what do our users really want? Maybe they made surveys, or studied data extensively. The majority of users only need a few of the best apps. After all, they don’t have much space on their phone. It’s also the mainstream audience, without any diverse tastes. Girls, for example, are a type of audience with very narrow tastes - just Talking Angela and the Barbie app would keep most of them happy. Well, after a while you could add Talking Angela 2 and Barbie 2, and then a few more sequels. Mobile users generally only play games which everyone else plays, in a narrow set of genres/templates. They don’t want to learn new rules in new games, and only want stuff which they already know.
Google and 80% of Android users would be just fine if the store had 100 of the best apps.
I know I’m exaggerating, and indeed Google also needs an inflow of new ideas, and new hits, and rotation in the top charts. But the store for a long time used to be a big junk pile - and that’s what users have been saying for years. Time for a cleanup. It’s also an image problem: Google, a big tech company, doesn’t want to be a trash pile.
While the algo is adjusting, some apps will go up, some down - all those on the fringes, feeding small studios and bedroom coders. If some of them will go under or temporarily thrive - Google and especially the majority of users couldn’t care less. Our loyalty lasts until the next AdMob paycheck anyway…
Our only hope is that Google somehow reconsiders its intent. It could be (as said) that AdMob revenue drop is too large. Or that they kinda pity the devs and assume that we still aren’t that worthless after all… Might be other considerations, too. Maybe some vocal users will say they won’t want Talking Cat Tom (unlikely).