Google Hits It Out of the Ballpark: Q1 Profit up 30 Percent

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Google Hits It Out of the Ballpark: Q1 Profit up 30 Percent

So it turns out, Google isn’t screwed. After a beatific sextet weeks of hand-wringing on Wall Street, the consort posted first-quarter results that easily vex expectations. The consensus Wall Street judge titled for earnings of $4.52 per share, patch Google came in at $4.84 per share, excluding charges.

"It was a rattling awesome performance," says director Research shrink Jeffrey Lindsay, who was bullish on Google feat into the announcement.

Despite distributed fright most a speed economy, the consort still
says it has seen no signs of imperfectness in its possess business. It was recognize programme to those
who were spooked by comScore reports early this assemblage that suggested
paid clicks — or clicks on sponsored ads — declined dramatically in
recent months. And for those who affectionateness Google as a bellwether for the internet economy, it’s a clew that the eruct haw not hit separate yet. Even as the subprime mortgage crisis bites into retail sales, the structure mart and another spheres of the economy, it seems to be leaving Google’s ad playing relatively untouched.

So how did Wall Street intend it so wrong?

"I conceive what happened was that grouping saw the comScore accumulation — which
really exclusive covers most 32 proportionality of Google’s income — and
extrapolated to every another parts of Google. But it doesn’t all apply," playwright says.

The digit anaemic blot for Google — kindred to terminal lodge — was ethnic networking. The consort has a $900 meg income care deal with MySpace, and up until now, that partnership hasn’t proven rattling profitable.

"We conceive ethnic networking cropped most 1.5 proportionality soured Google’s large margins. And that’s purely because MySpace is not performing," playwright says.

And though Google co-founder Larry Page conceded the consort hasn’t institute the course blot on MySpace yet, he says the consort is making progress.

"We’ve practical a aggregation of newborn technologies," Page said. "And we’ve been flourishing with demographic targeting. But conception of the [problem] is effort an ad ecosystem shapely up [on ethnic networks.] We’ve prefabricated a aggregation of improvements and I’m pollyannaish that there are more improvements to be made."

We blogged Google’s first-quarter earnings word call live, which you crapper verify a gander at downbound below.

And here are the nakedness numbers:

Revenue was $5.19 billion, up from $3.66 billion, year-over-year.
Net income was $1.31 billion, up from $1 1000000000 terminal year.
Earnings came in at $4.12 per share, up from $3.18 terminal year.
Analysts due $4.52 per share, and excluding a slew of charges, Google would hit attained $4.84 per share, handily superior expectations.
Headcount at the modify of the prototypal lodge was 19,156, up from 16,805 at the modify of the ordinal quarter. Of the 2,351 employees added, roughly 1,500 were related with DoubleClick.

Just a some minutes
after the first-quarter earnings word call started, Eric Schmidt
dismissed comScore reports that paying clicks, or the sort of
clicks on sponsored ads, has sadly lagged.

"Paid utter ontogeny is such higher than speculated by ordinal parties," solon said.

Sergey Brin follows solon on the call and he sounds a lowercase giddy: "We’re apparently rattling agog most this quarter."

Brin doesn’t feature such most the biz, meet talks pugilism products –
lots of advancement reports on see improvements, Street View listing outs,
etc. Says he’s mitigated with status in 700 rate spectrum
auction, modify though Google didn’t achievement absent with some spectrum.

"We’re rattling entertained with the results," Brin said.

Larry Page takes over on the call (sounds peculiarly kindred to Kermit
the Frog). He mainly talks most advancement on Google analytics, YouTube,
etc. Says Google is "very very" agog most approaching DoubleClick
acquisition. Thinks there are "huge opportunities" and he’s pleased
with advancement thusly far.

On to Q&A:

Asked most CFO replacement, solon says there are a aggregation of
candidates they’re rattling fascinated in but they haven’t prefabricated some offers
yet.

Sergey Brin on expanding pass ads on Google properties: Says they
already ingest pass ads on YouTube and could modify to another Google
properties, but there aren’t some limited plans that they crapper discuss
right now.

Eric solon on scheme conditions: They’ve seen no signs of
weakness, but they’ve discussed the supply internally and over that
Google is "well positioned should economics change."

Schmidt also dodges a discourse most the two-seek effort with Yahoo,
saying only, "It’s pleasant to be employed with Yahoo. We same them very
much."

Yowza — Google shares are trading above $528, up more than $79, or 17 percent, in after-hours trading.

Photo: Flickr/wwphoto

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