Google Rakes It In


lotto1.jpgIt was a pretty good Q2 for Google as they announced their end of quarter numbers yesterday. With an increase in revenues of 6% from first quarter which translates to $3.8 billion. The company has enjoyed an increase of 58% year-over year. Google paid out over $1 billion in Traffic Acquisition Costs (TAC) when distributing 30% of advertising revenue to various partners.

There was also an increase in operating expenses jumping up 5% to $1.2 billion. The company claims the majority of increased spending is from payroll for the 1,500 new employees. Even though the overspending will be monitored, the execs at Google believe in their decision to increase the staff.

The company is outwardly more concerned about the Viacom lawsuit than the DoubleClick investigation. At least to the press. CEO Eric Schmidt commented about the Authors Association of America and the Viacom copyright infringement suits saying, “it would be great if they would go away, but we take them very seriously.”

Senior vice president of global sales and business development, Omid Kordestani explained that although sales, marketing and engineering teams are working on overdrive on radio and print ads as well as YouTube’s ad platform, it is “too early to see a material impact, given the scale of the main side of the business.” There are many non-search advertising efforts globally which is the big reason for so many international hires.

eMarketer senior analyst David Hallerman stated, “Google’s spectacular revenue growth remains unbalanced by its reliance on text-link ads. Getting greater acceptance among its advertisers for video and display ads on its network will be one of Google’s greatest challenges this year.”

Analysts say that the $5.9 billion in online advertising revenue projected for the company’s fiscal year, is largely dependent on search. Google accounts for 30% of the whole U.S. market.


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