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Google Has $14 Billion Quarter But Misses Earnings Estimates
Google reported its second quarter earnings and revenues today. Total consolidated revenues (including Motorola) were $14.11 billion. That represents a 19 percent increase vs. last quarter, which was good — but not good enough apparently.
By most analyst estimates, which were extremely bullish, this was a miss. Google is off in after-hours trading.
Here are the highlights by category:
- Google revenues: $13.11 billion, a 20 percent increase over Q2 2012
- Google-owned sites: $8.87 billion, an 18 percent increase over Q2 2012
- Google Network revenues: $3.19 billion, a 7 percent increase from Q2 2012
- Other revenues: $1.05 billion, a 138 percent increase vs. Q2 2012
- Non-US revenues were $7.2 billion (55 percent of total)
Paid clicks grew 23 percent vs. Q2 2012 but CPCs were down 6 percent vs last year. This is being interpreted by as continued weakness from the mobile sector.
Traffic acquisition costs represented 25 percent of ad revenues in Q2. And Motorola Mobility revenues were $998 million vs $843 million in 2012. More data and detail are available in the full release.
US vs. International Revenues:
Facts, comments and observations from the earnings call:
From Larry Page’s opening remarks:
- Chrome the browser has 750 million users worldwide
- 1.5 million Android devices are now being activated daily
- 15 billion apps have now been downloaded in Google Play
- Knowledge Graph is now available in 29 languages
- Page added that 75 percent of active AdWords campaigns (6 million) have been upgraded to enhanced campaigns, with the deadline rapidly approaching.
There were many questions about the impact of enhanced campaigns and its effect on revenue. Most of Google’s executives’ responses were very general. Google was pleased with the migration to date but it was still to early to make definitive statements about the full impact.
However Google said enhanced campaigns would help advertisers through simplification and have a positive revenue impact “in the long term.”