Google Earnings Ahead of Plan

Print Email

Google Inc. (NASDAQ: GOOG) is out with fourth-quarter earnings of $10.65 per share, and we caution investors about using the revenue numbers due to the sale of Motorola Home. Sales on an ex-TAC basis came in at $11.34 billion in revenue without including Motorola Home, but $12.16 billion if you include the unit. The consolidated revenues were $14.42 billion for the quarter, but that includes the Traffic Acquisition Costs and on an ex-TAC basis we would tally these up as $12.16 billion. In case the analysts were not able to factor in the ex-operations, it would be $15.24 billion net in sales if you included the Motorola Home sales. Thomson Reuters had estimates of $10.52 EPS and $12.36 billion in ex-TAC revenue.

This was the first Internet giant to report and the stock remains about 10% off of its highs. Look for this to be the benchmark for online ad marketing dollars for Facebook, Yahoo!, AOL and others. Other key numbers:

  • Google-owned sites generated revenues of $8.64 billion, or 67% of total Google revenues, in the fourth quarter of 2012. This represents a 18% increase over fourth quarter 2011 Google sites revenues of $7.29 billion.
  • Google’s partner sites generated revenues of $3.44 billion, or 27% of total Google revenues, in the fourth quarter of 2012. This represents a 19% increase from fourth quarter 2011 Google network revenues of $2.88 billion.
  • Other revenues from Google were $829 million, or 6% of total Google revenues, in the fourth quarter of 2012. This represents a 102% increase over fourth quarter 2011 other revenues of $410 million.
  • Google revenues from outside of the United States totaled $6.9 billion, representing 54% of total Google revenues in the fourth quarter of 2012, compared to 53% in the third quarter of 2012 and 53% in the fourth quarter of 2011.
  • Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of Network members, increased approximately 24% over the fourth quarter of 2011 and increased approximately 9% over the third quarter of 2012.
  • Traffic acquisition costs, the portion of revenues shared with Google’s partners, increased to $3.08 billion in the fourth quarter of 2012, compared to $2.45 billion in the fourth quarter of 2011. TAC as a percentage of advertising revenues was 25% in the fourth quarter of 2012, compared to 24% in the fourth quarter of 2011.
  • Operating expenses, other than cost of revenues, were $4.81 billion in the fourth quarter of 2012, or 33% of revenues, compared to $3.38 billion in the fourth quarter of 2011, or 32% of revenues.
  • Google’s effective tax rate was 18% for the fourth quarter of 2012.
  • Net cash provided by operating activities in the fourth quarter of 2012 totaled $4.67 billion, compared to $3.92 billion in the fourth quarter of 2011. As of December 31, 2012, cash, cash equivalents, and marketable securities were $48.1 billion.
  • On a worldwide basis, Google employed 53,861 full-time employees (37,544 in Google and 11,113 in Motorola Mobile and 5,204 in Motorola Home) as of December 31, 2012, compared to 53,546 full-time employees as of September 30, 2012.

Google closed down 0.2% at $702.87 on the day ahead of earnings and the 52-week trading range is $556.52 to $774.38. The stock is currently trading up about 4% around $730 after the report but we will consider this unfinished business due to all of the exceptions and since the stock has sloshed around after past earnings reports.

RSS Facebook Twitter