Marketing

Google profits better than expected

17.04.2009
Google has reported relatively strong results for the quarter ending March 31 2009. While revenue was down 3pc over Q4 2008, the company recorded year-on-year growth of 6pc to US$5.51bn.

Net profits, meanwhile, were up 8pc year-on-year, from US$1.3bn for the first three months of 2008 (US$4.12 per share) to US$1.42bn ($4.49 per share) for the equivalent period this year.

“Google had a good quarter given the depth of the recession,” said Eric Schmidt, the company’s CEO, who attributed the results to continued strong query growth. “These results underline both the resilience of our business model and the ongoing potential of the web as users and advertisers shift online, "Going forward, our priority remains investing for the long term to drive future growth in our core and emerging businesses."

Google-owned sites generated revenues of US$3.7bn, or 67pc of total revenues, in Q1 2009, a 9pc increase over Q1 2008 and a 3pc decrease from fourth quarter 2008 revenues of US$3.81bn.

The company’s partner sites generated revenues, through AdSense programs, of US$1.64bn, or 30pc of total revenues, in Q1, down 3pc from both Q1 and Q4 2008.

Revenues from outside of the United States amounted to US$2.88bn, or 52pc of total revenues in Q1 2009.

UK sales came to US$733m, or 13pc of overall revenue.

Aggregate paid clicks, including clicks related to ads served on Google sites and the sites of its AdSense partners, increased by around 17pc over Q1 2008 and increased by approximately 3pc over Q4 2008.

Google said that traffic acquisition costs (TAC) fell from US$1.48bn to US$1.44 between Q4 2008 and Q1 2009. In both quarters, this represented 27pc of advertising revenues. “The majority of TAC is related to amounts ultimately paid to our AdSense partners, which totaled US$1.23bn in the first quarter of 2009. TAC also includes amounts ultimately paid to certain distribution partners and others who direct traffic to our website, which totaled US$207m in the first quarter of 2009,” the company said.