Google’s revenue growth continues
Google’s growth has continued, according to its results for 2008, which were released about an hour ago.
Based on US accounting methodology, the search giant saw revenues of US$5.7bn for the last quarter of the year – an increase of 18% on the same quarter in 2007 and of 3% on the previous quarter in 2008. Operating profits were $1.86bn for the quarter.
CEO Eric Schmidt said: “Google performed well in the fourth quarter, despite an increasingly difficult economic environment. Search query growth was strong, revenues were up in most verticals, and we successfully contained costs.”
He added: “It’s unclear how long the global downturn will last, but our focus remains on the long term, and we’ll continue to invest in Google’s core search and ads business as well as strategic growth areas such as display, mobile, and enterprise.”
Whe Schmidt visited Australia last year, Mumbrella asked him about the economic outlook, and he said that a downturn would still see Google in a strong position as marketers might turn to direct response rather than brand building, adding: “If there were a recession we would be well positioned.”
One of the areas Schmidt may have been referring to in containing costs is the amount paid to Google’s affiliates including through the AdSense programme, with many online publishers anecdotally reporting declines. This fell slightly on the previous quarter, from $1.5bn to $1.48bn. The cost to Google as a percentage of its advertising revenues was down from 28% to 27%.
About half of Google’s revenues come from outside the US, with the UK accounting for a further 12% in the last quarter. The earnings report does not break out Australian or Asia Pacific numbers.
However, last year an authoritative report by Frost & Sullivan said that the Australian search market was worth $870m in 2008., and Google would have taken the lion’s share of this.
According to today’s figures, Google’s profits for the quarter are down, mainly as a result of accounting for one-off costs. But the results are still said to have exceeded analysts’ expectations.
Update: Meanwhile, the search firm has slackened its ambitions in New Zealand, reports Digital Media Magazine, which says Google won’t be filling its vacant NZ country manager chair.
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