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News : International Last Updated: Jul 19, 2010 - 9:35:04 AM


Google reports growth in second quarter profit and revenue but below market expectations
By Finfacts Team
Jul 16, 2010 - 5:13:17 AM

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To measure which country has the most loyal fans, Google computed the proportional drop in queries during each of its team’s matches compared with normal query volume. Brazil topped the charts with queries from that country dropping by half during its football games. Football powerhouse and third-place winner Germany came in second, followed by the Netherlands and South Korea.

Google on Thursday reported growth in second quarter profit and revenue as online advertising continued its rebound. However, the results were below market expectations as the company's search business continued to show signs of slowing growth.

Google said net income rose 24% from a year earlier to $1.84bn while revenue rose to $6.82bn from $5.52bn in the same quarter last year.

“Google had a strong second quarter,” said Eric Schmidt, CEO of Google. “Solid growth in our core business and very strong growth in our emerging businesses drove 24% revenue growth year over year. We saw strength in every major product area, as more and more traditional brand advertisers embraced search advertising and as large advertisers increasingly ran integrated campaigns across search, display, and mobile. We feel confident about our future, and plan to continue to invest aggressively in our core areas of strategic focus.”

The top global search engine firm said it was "very pleased" with the rise in advertising across all sectors and increased spending on search advertising by traditional brands, such as those from personal care and detergent giant, Procter & Gamble Co. "These results reflect important trends in online advertising," said Google's finance chief, Patrick Pichette, on a conference call Thursday.

The number of clicks on ads served on Google's websites and partner sites rose by 15% from a year earlier, but was lower than growth two years ago. Also, the average cost that advertisers paid Google for clicks on their ads increased by 4% compared with the 7% rate in the first quarter.

Earnings per share of $6.45 compared with analyst expectations of $6.52. The shares fell 4% in after-hours trading Thursday.

Revenues from outside of the United States totaled $3.53bn, representing 52% of total revenues in the second quarter of 2010, compared to 53% in the first quarter of 2010 and 53% in the second quarter of 2009. Excluding gains related to Google's foreign exchange risk management program, had foreign exchange rates remained constant from the first quarter of 2010 through the second quarter of 2010, revenues in the second quarter of 2010 would have been $176m higher.

As of June 30, 2010, Google had cash, cash equivalents, and short-term marketable securities were $30.1bn compared to $26.5bn at March 31, 2010.

On a worldwide basis, Google employed 21,805 full-time employees as of June 30, 2010, up from 20,621 full-time employees as of March 31, 2010.

The Wall Street Journal reports that US advertising revenues for Internet companies are expected to grow about 11% this year to $25.1bn, after shrinking 3.4% last year, according to research firm eMarketer.

Results detail

Jason Helfstein, of Oppenheimer & Co., shares his reaction to the tech giant's quarterly results:

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