Google Q2 Results: Marginal Topline Growth,PPC prices sees revival

Google announced its Q2 june results logging a paltry 3% (YoY) growth in revenues to $5.52 billion compared to last year’s $5.37 billion.The Net Income was seen at $1.48 billion registering a growth of 18% compared to 1.25 billion a year ago period.

Revenues from Google owned sites was seen at $3.65 billion,66% of total revenues-a growth of 3% over second quarter 2008 revenues of $3.53 billion.

Revenues from outside of the United States totaled $2.91 billion, representing 53% of total revenues, compared to 52% in the Q1- 2009. This is the first time Google has breached International revenue contribution figure of 52%.

The operating margin picture was very much stagnant at 34% still good compared to erosion seen in other Online giants. Google also seems to be spending more cash on capex as Free cash flow was down to  $1.5 billion compared to $2 billion in previous quarter.

Revival in PPC prices?

Cost per click was up 5% over the first quarter of 2009 although was lower by 13% over the second quarter of 2008. Paid Clicks(CTR) seems to have decreased 2% over the first quarter of 2009 although it registered an appreciable 15% growth over the second quarter of 2008.

This suggests that the PPC prices has seen revival from the march quarter in line with economic revival panned out across the globe, Although CTR’s continued its downfall is a worrisome fact.

Google’s TAC – Traffic Acquisition Costs, the portion of revenues shared with Google’s partners, decreased to $1.45 billion in the second quarter of 2009, compared to TAC of $1.47 billion a year ago. The pay-out to AdSense partners, totaled $1.24 billion in the second quarter of 2009.

Google has also conveyed its focus on Display, apps and mobile in coming quarters. The major benefits from its acquisition of Youtube would be accrued in next few quarters as it revives monetization strategies for it. The revival in PPC prices despite entry of new competitors like Bing is also positive for the company.

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