Google’s third-quarter results were published on Thursday, and I had a chance to look into the results this morning. Some of the key financial figures were already covered in Thursday’s brief post on this, so I’d like to focus on what I thought was interesting out of the conference call.
As the headline suggests, Google’s growth remains very strong. It posted $ 14.9 billion in total revenue, including the Motorola segment, which still loses a couple hundred million dollars per quarter. But the ex-Motorola revenue numbers (called the Google segment) are up huge. Specifically, the business is up 21 percent year over year. (For the sticklers, this number is on a constant currency basis, so it ignores FX effects, and I think it’s a better reflection of real growth.)
There’s nothing too surprising in the financials, aside from the impressive revenue growth. A good revenue quarter and rising operating margins mean solid overall profit, which has Wall Street excited. Remember that stocks tend to move based on short-term results (and short-term thinking), so none of this is particularly due to the strength of Android, or Chromebooks, or Google Play revenue — despite their importance in the grand scheme of things.
Google repeated September’s news that it has activated more than 1 billion Android handsets and is still activating them at the impressive rate of 1.5 million per day. That continues to be up from 900 million complete tool activations in May just.
Cool merchandise no longer withstanding, Google continues to be a search and promotion firm, in the beginning.
Anyway, Google’s major trade is promoting advertisements. That trade is rather robust, and is accountable for lots of the increase. By using one estimate, Google holds three p.c of the full promoting market. Taking into consideration how essential the net phase is, and what quantity of money continues to be spent on print promotion, most consultants imagine there are nonetheless lots of advert bucks to maneuver on-line. Google will make the most of this. That implies extra money to plow again into modern R&D initiatives.
I realized that Google says forty p.c of YouTube site visitors is now coming from cell customers. That’s lovely superb taking into account it was once simplest 6 % two years in the past. Additionally on the cell entrance, Google is lovely thinking about the success of some purchaser advert campaigns the place “click on to name” is used. It sounds as if cell commercials that concentrate on click on to name are extremely a hit. Right here’s a query for these extra accustomed to the internal workings of the OS than I’m: Provided that Google has full keep an eye on of Android (versus get admission to best to APIs on iOS), can it do a greater job of monetizing eyeballs with its personal OS? I’d love to peer some dialogue on this within the feedback.
So given the expansion that Google simply posted, the inventory has pushed via $ 1,000 per share for the primary time. As of market shut Friday, Google is price $ 337 billion. Apple remains to be price extra, at $ 462 billion, however most of this distinction may also be defined via Apple’s monumental $ 147 billion in money versus “handiest” $ fifty six billion for Google.
I’m a shareholder of each firms. I’m bullish on each shares. If I completely needed to decide simplest some of the two shares to carry onto, I believe it could be Google. I like their keep an eye on of internet marketing, dominance in social video, and dominance in cell computing.