Google Q4-FY12: $14.42 Billion Revenue; 36% Revenue Growth YoY


Google has posted consolidated revenues of $14.42 billion for the quarter ending December 31, 2012, registering a 36% growth in revenues year-on-year (YoY).

Its worth noting that this revenue is reported without deducting the traffic acquisition costs of $3.08 billion. Google CEO Larry Page also informed that Google hit $50 billion in total revenues for the first time in 2012, since its inception in September 1998.

Financials

- Google Revenues (Advertising and others): Google reported revenues of $12.91 billion, up 22% from $10.58 billion revenues posted in the same quarter last year. These revenues represented 89% of Google’s consolidated revenues for the quarter.

Motorola Mobility Revenues (Hardware and others): Motorola Mobility reported revenues of $1.51 billion, representing 11% of Google’s consolidated revenues, for the quarter. While this revenue is significantly lower from the $2.58 billion in the previous quarter, its worth noting that this revenue is from Motorola’s mobile segment only. Motorola Mobility inked an agreement with Arris Group in December 2012, to sell its home business for $2.35 billion in cash and stock. As per the agreement terms, Google is expected to receive $2.05 billion in cash and around $300 million in newly issued ARRIS shares, representing 15.7% stake in the company. The acquisition is expected to close in 2013.

Google informed that it has mentioned the financial results of Motorola’s Home business as net loss from discontinued operations in the consolidated income statements and has excluded all other results related to Motorola’s Home business from its results. It added that if Motorola Home’s revenues were included, Google’s consolidated revenues would’ve increased to $15.24 billion, indicating that Motorola Home had registered $0.82 billion revenues during the quarter.

Google started reporting Motorola Mobility’s operating results from Q2-FY12, after completing the $12.5 billion acquisition on May 22, 2012. In Q2-FY12, Motorola Mobility reported total revenues of $1.25 billion for its mobile and home business, from the acquisition date in August 2011 through June 2012.

Google owned sites vs network: Google-owned sites generated revenues of $8.64 billion for the quarter, a 18% increase YoY from $7.29 billion in Q4-FY11, while the network revenues from partner sites (through Adsense programs) were $3.44 billion, up 19% YoY from $2.88 billion in Q4-FY11. Advertising accounted for around 94% of Google revenues and around 83.8% of Google’s consolidated revenues.

Other Revenues: Other revenues for the company stood at $829 million for the quarter, registering a 102% growth from $410 million in Q4-FY11. However, its not clear as to what is included in these other revenues.

– US vs International Revenues: Revenues from outside of the United States stood at $6.9 billion, representing 54% of the total revenues for the quarter, as compared to 53% in the previous quarter and 53% in the same quarter last year.

Impact of Foreign Exchange on Google Revenues: Google mentioned that, had the foreign exchange rates remained constant from Q3-FY12 to Q4-FY12, its revenues would have been $130 million lower and if the foreign exchange rates remained constant from Q4-FY11 to Q4-FY12, its revenues would have been $193 million higher. Note that Google has excluded the gains earned through its foreign exchange risk management program for the quarter. Google recognized a benefit of $37 million through this program for the quarter, as compared to $25 million in the same quarter last year.

Paid Clicks: Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of AdSense partners, increased approximately 24% YoY, and 9% quarter on quarter (QoQ).

- Cost-Per-Click: Average cost-per-click, which includes clicks related to ads served on Google sites and the sites of AdSense partners, decreased approximately 6% YoY and increased approximately 2% QoQ.

Traffic Acquisition Costs: As stated earlier, the Traffic acquisition cost (TAC), the part of Google’s revenues which is shared with its partners, stood at $3.08 billion for the quarter, up from $2.45 billion in the same quarter last year. Breaking down the traffic acquisition costs, Google stated that out of $3.08 billion, it paid $2.44 billion to its network members and $634 million to certain distribution partners and others who directed traffic to their website.

- Total Cash: As of December 31, 2012, Google had $48.1 billion money in form of cash, cash equivalents, and marketable securities.

– Headcount: On a worldwide basis, Google employed 53,861 full-time employees as of December 31, 2012, up from 53,546 full-time employees as of June 30, 2012. Note that this includes 37,544 full-time employees in Google business, 11,113 full-time employees in Motorola mobility business and 5,204 employees in Motorola Home business, as compared to 36,118 full-time employees in Google business and 17,428 full-time employees in Motorola business in the previous quarter.

Download: Release | Financials

Related:

- Google Q3 2012: 45% Revenue Growth YoY; $14.10 Billion Total Revenue
Google Q2 2012: 35% Revenue Growth YoY; $12.2 Billion Revenue
Google Q1 Results: Stock Split; 850,000 Android Activations Daily; 170M Google+ Users; Financials