Google's Q4 earnings beats expectations

Google's fourth quarter earnings rose up to 34% for the quarter ended December 31, 2008. The company reported a net income of $382 million, a big decline from the $1.21 billion the year earlier. Still, excluding one-time charges the earnings per share were $5.10, which is 15 cents above the $4.95 expected by financial analysts. The results sent Google shares up 2.6% in after-hours trading.

Total revenue reported was $5.7 billion, an 18% increase from the fourth quarter of 2007. Excluding the traffic acquisition costs, Google had $4.22 billion in revenue, (up by 24%) ahead of analysts' projections of $4.12 billion and the year-earlier $3.39 billion. Gross revenue is up by 4%. Google-owned sites generated 22% more revenue than the fourth quarter of 2007, contributing 67% of total revenue.

Google's Chief Executive Eric Schmidt said in a statement that Google had performed well in the fourth quarter, despite an increasingly difficult economic environment. Search query growth was strong, revenues were up in most verticals, and Google successfully contained costs. He also added that it was unclear how long the global downturn will last, but Google would remain focussing on the long term and will continue investing in Search and Ads business as well as in strategic growth areas such as display, mobile, and enterprise.

While pay freezes are becoming a common scene across the country as companies try to lower their expenses without firing employees, Google has announced a stock option exchange program for its employees.

So far - Apple, Google, HP and IBM are the only 4 big companies to have reported profit in their Q4 earnings.

Images Courtesy: Google

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9 Comments

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That's great, hopefully they won't have to fire any employees. Didn't MS also post a profit (albeit not as much as expected)?

Well I guess some of you just see that Google's earned more than they expected but you fail to see that last years earning were $1.21 billion which is a way too big of a decline to $382.

And from a business prescriptive, I would want my company to make large profits, at any given circumstances.

To be clear, they laid-off 100 unneeded position in HR. Since google isn't hiring at the rate they used to, they don't need as many HR people who would just be sitting there, twiddling their thumbs all day. There are other positions in the company where some of those 100 people could move to. As for the cheap holiday bonus, I don't think a bonus that cost the company >$400 per person is particularly cheap.

bluewind_89 said,
At least someone's doing well.

since when is performing 70% worse than the year before a good thing? The profit is only a third of what it used to be... what about next year? Especially because Google's main income (internet adverts) is on a constant and dramatic decline for a few years.

I'm not sure if Google will be able to make any profit at all the same time next year unless they change dramactically...