Google boasts 'record year' for 2012

Google generated record revenues of $50bn in 2012, posting $14.42bn in the last quarter of the year, despite a decrease in its average cost-per-click (CPC) rate and growing competition in the search sector.

Google

 

Revenues for the quarter ending December 31 were up 36 per cent year-on-year and 8 per cent from the previous period according to its latest financial filing. This figure could have reached as high as $15.24bn had the revenues of (soon-to-be sold off) Motorola Home unit been included.

Revenues for the quarter ending December 31 were up 36 per cent year-on-year and 8 per cent from the previous period according to its latest financial filing. This figure could have reached as high as $15.24bn had the revenues of (soon-to-be sold off) Motorola Home unit been included.

Larry Page, CEO of Google, says: “We hit $50bn in revenues for the first time last year - not a bad achievement in just a decade and a half. In today’s multi-screen world we face tremendous opportunities as a technology company focused on user benefit. It’s an incredibly exciting time to be at Google.”

Revenues from Google sites were $12.91bn, representing an 89 per cent of total income in the fourth quarter (a 22 per cent annual increase), while its partner sites generated revenues of $3.44bn, representing 27 per cent of revenues (a 19 per cent annual increase). A breakdown of its UK earnings can be seen in the chart below.

Google-chart-Q3-2012

Source: Google

The filing further revealed the number of clicks on paid-for ads, including those served on Google-owned and partner sites, was up 24 per cent 24 year-on-year, 9 per cent from the previous quarter.

However, it also noted the average CPC for ads served on Google-owned and partner sites dropped 6 per cent year-on-year, 2 per cent from the previous period.

In Google’s subsequent earnings call, CEO Larry Page described consumers’ shifting their search habits from desktop to mobile as “uncharted territory” although he was “optimistic” for monestising this trend.

When asked to comment on his ambitions to raising CPC rates on mobile devices - which are historically much lower than desktop rates - he said: “I think that CPCs will improve as these devices are improving as well… we are working to simplify our ad system for advertisers.”

The figures come as Experian research revealed that Google’s share of the UK internet search market dipped slightly in December 2012 chiefly to the benefit of rival search providers Microsoft and Yahoo.

Google commanded a mammoth lead in the UK market with an 88.35 per cent market share, down 0.77 per cent from November and 2.8 per cent annually, according to Experian.

The figures also demonstrated Microsoft’s search engine Bing posted modest growth with a 1.15 per cent annual increase in market share, taking it to 4.99 per cent. Meanwhile, Yahoo also posted modest growth with a 0.886 per cent increase, taking it to a 3.58 per cent market share as of last month.

Google’s dominance in the search market has been increasingly coming under fire with the search giant preparing to submit proposals to the EC competition commission as part of the regulator’s formal investigation into how it displays its search results.

More recently, Facebook and Twitter declared their intentions to ramp-up their search operations which could pose an attractive alternative to Google among advertisers.

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