Google Earnings Show Search Business is Stronger Than Ever
Google shares shot up about $30 today as Google released its earnings numbers from Q3 which blew away industry and Wall Street expectations. The earnings amounts even shocked one of the top Googlers. “We surprised ourselves this quarter,” Google CEO Eric Schmidt said during a Thursday interview. “Business was much stronger than I expected.”
Google revenues totaled a record $1.578 billion, representing a 96% increase over third quarter 2004 revenues of $806 million, and a 14% increase over second quarter 2005 revenues of $1.384 billion. The expansion of Google owned sites and properties along with Google AdSense, Google’s online advertising network, led to the increase.
Revenue from Google’s site and Google tools (like GMail) generated $885 million, or 56% of total revenues. This represents a 20% increase over the second quarter revenues of $737 million.
Google AdSense earned Google $675 million, or 43% of total revenues. This is a 7% increase over network revenues of $630 million generated in the second quarter.
Notice the difference in increases between Google sites and the AdSense network. This is probably due in part to the formation of the Google ‘portal’ and increased usage by Google members of Google instruments, leading to more searches, which serve Google AdWords and their much higher pay-per-click prices than AdSense.
The Google Earnings release is available for review from Google Investor Relations.