Google today released their financial results for the fourth quarter of 2012 with consolidated revenues hitting US$14.42 billion with the revenue of Motorola Home not yet included. This result beat the expectations of analysts who had reservations on the company’s performance.
According to Larry Page, CEO of Google, “We ended 2012 with a strong quarter. Revenues were up 36% year-on-year, and 8% quarter-on-quarter. And we hit $50 billion 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.”
One of the biggest factors that contributed to the success of the company is their Search and Display advertising which contributed 95% of its total revenue for 2012. Also making gains are video and mobile advertising which will definitely become important for the company this year.
Google shares rose by as much as 4% on late day trading following the release of the earnings report. Company stocks now stand at $27 a share.
One thing that is declining though is the value of the company’s ads. The average cost per click of a Google Ad has decreased by as much as 6% compared to a year ago. This means that each ad is worth less than what it did a year ago. What compensated for this decline is the number of people who use Google.
The biggest contributing factor to this decline is the presence of Facebook. The introduction of the Graph Search by the giant social network is likely to even reduce the cost per click of Google even more in the coming months.
Despite this the company has still managed to breach the US$50 billion mark for 2012 which is already quite impressive. Moving forward the company intends to improve its mobile presence while also making sure that its video presence remain as strong as ever.