Once you select the PDF file, it will be opened automatically in Google Drive. If it does not automatically open, ensure that you allow pop-ups from Google Docs.
Click Open in Google Docs at the top of the page to have the PDF converted and opened in Google Docs. This may take a minute or two, depending on the length of the document.
Now that your PDF is open in Google Docs, it is automatically saved in Google Docs under the file name of the PDF.
Change Google Doc file name
You may want a different file name for the PDF that you converted to a Google Doc. If so, simply click the file name on the top-left and edit it how you wish.
Fix formatting issues from conversion
While Google does a great job converting PDFs to Google Docs, it's still not a perfect process. Even if you're converting a Word doc to a Google Doc, you should go through your new Google Doc to ensure that the formatting is the way you want it. You may find that you need to change the margins, double-space, or make other changes to the Google Doc.