Feeds

Google fails to excite on revenue surge

Tired of over-achievement

The Power of One Infographic

Google's income nearly tripled over the Christmas holiday period, boosted by growing online advertising, but failed to excite investors.

The advertising giant reported a 176 per cent increase in net income for the three months to December 31 to $1.03bn on revenue that jumped 67 per cent to $3.2bn. Earnings per diluted share increased $2.07 to hit $3.29.

Annual net revenue doubled to 110 per cent to $3.07bn on revenue of $10.6bn, an increase of 72 per cent, and EPS that nearly doubled to $7.05.

Money from Google sites increased 80 per cent to $1.98bn in the quarter, accounting for 62 per cent of the pie. Revenue from partners' sites, affiliated through the AdSense engine, grew 50 per cent and accounted for 37 per cent of Google's business.

Traffic acquisition costs (TAC) increased 40 per cent to $976m, but continued its downward march as a proportion of Google's ads business thanks to the health of the overall business. TAC was down almost three percentage points to 30.7 per cent.

So it was a little puzzling that Google was down in after hours trading. Shares in the giant fell by as much as $15, or three per cent, despite Google pretty much hitting expectations.

Either Wall Street is tiring of Google's good fortune and its wanton commitment to keep ploughing juicy revenue back into the business or is getting a little frustrated at a lack of answers over how the $1.65bn YouTube acquisition will translate into search-driven ad revenue and growth.

Chief financial officer George Reyes told investors to expect "significant" investment in Google's technology infrastructure, advertising partnership and internet services, and continued expansion in staffing. Investment will ramp up as Google pushes into video, radio and brand advertising, co-founder and president Sergey Brin said.

On YouTube, executives promised integration with Google search "overtime" but would not be drawn on specifics or break out revenue. The company, meanwhile, said mobile search traffic would increase substantially during 2007. ®

Boost IT visibility and business value

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Airbus promises Wi-Fi – yay – and 3D movies (meh) in new A330
If the person in front reclines their seat, this could get interesting
UK Parliament rubber-stamps EMERGENCY data grab 'n' keep bill
Just 49 MPs oppose Drip's rushed timetable
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Samsung threatens to cut ties with supplier over child labour allegations
Vows to uphold 'zero tolerance' policy on underage workers
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
prev story

Whitepapers

Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.