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Google Q2 2012: 35% Revenue Growth YoY; $12.2 Billion Revenue

Google has posted consolidated revenues of $12.21 billion for the quarter ending June 30, 2012, registering a 35% increase in revenues Year-on-Year (YoY) and 15% increase quarter-over-quarter (QoQ). Note that this total revenue is without deducting the traffic acquisition costs which accounted for $2.60 billion or 25% of the company’s advertising revenues.


Google Revenues (Advertising and others): Google generated revenues of $10.96 billion, or 90% of total revenues, in the second quarter of 2012, representing a 21% increase from $9.03 billion revenues posted in the second quarter of 2011.

Motorola Mobility Revenues (Hardware and others): Google completed the acquisition of Motorola Mobility on May 22, 2012, after acquiring the company for $12.5 billion in August 2011. It has therefore included Motorola’s assets and liabilities in the balance sheet and included Motorola’s operating results from the acquisition date through June 2012. Motorola generated revenues of $1.25 billion or 10% of total revenues in the second quarter of 2012.

While the mobile segment accounted for $843 million revenues, the home segment accounted for $407 million revenues. During the earnings call, Google noted that Motorola has experienced a strong sales of Motorola Droid Razr Maxx driven by Verizon in North America during the quarter but it also experienced a decline in international sales of Motorola’s feature phones and mid-tier smartphones.

Google owned sites vs network: Google-owned sites generated revenues of $7.54 billion during the second quarter of 2012, or 69% of total revenues, a 21% increase YoY from $6.23 billion while the network revenues from partner sites (through Adsense programs) were $2.98 billion or 27% of total revenues during the second quarter of 2012, a 20% increase YoY from $2.48 billion.

US vs International Revenues: Revenues from outside of the United States totaled $5.96 billion, representing 54% of total revenues in the first quarter of 2012, as compared to 54% in the first quarter of 2012 and in the second quarter of 2011. Revenues from the United Kingdom totaled $1.18 billion, representing 11% of revenues.

Paid Clicks: Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of AdSense partners, increased approximately 42% year on year, and 1% quarter on quarter.

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 16% year on year and increased approximately 1% quarter on quarter.

Headcount: On a worldwide basis, Google employed 54,604 full-time employees as of June 30, 2012, up from 33,077 full-time employees as of March 31, 2012. Note that this includes 34,311 full-time employees in Google business and 20,293 full-time employees in Motorola business.

Other Significant developments

Advertising: During the quarter, Google overhauled its DoubleClick ad platform to launch DoubleClick Digital Marketing ad platform. It also integrated its display ad acquisitions Teracent and Invite Media to the platform. The company claimed both this companies grew by more than 50% last year. Admob mobile ad platform which currently powers the company’s mobile ads across Android and iOS was also integrated to Adwords in June 2012.

During the earnings call, Nikesh Arora Google’s Senior Vice President and Chief Business Officer, claimed that Admob currently has one million mobile advertisers running ads across 300,000 mobile apps with a reach of 350 million mobile devices. When queried on the trends they are seeing in mobile cost-per-click rates, he claimed that they are seeing phenomenal growth in the mobile queries across various form factors like mobile phones and tablets and are registering healthy rates across all geographic regions, although he didn’t reveal any specific information.

YouTube: Arora also claimed that the yearly account signups have doubled YoY and users are now uploading over 72 hours of video every minute. He also claimed that YouTube has now found an effective business model. While he didn’t reveal any specific information, he noted that thousands of YouTube partners are making six figures yearly income through the site.

Search: Susan Wojcicki, Google’s Senior Vice President for Advertising, stated that Google’s Knowledge Graph now includes 3.5 billion facts about 500 million things, people and places including landmarks, celebrities, and sport teams among others.

Google+: Susan was also pleased with the growth of Google+ . She noted the recent launch of Google+ Local which allows users to find and share local businesses like restaurants and museums and claimed that Google+ Local now offers information about 100 million places and local businesses. She also informed that over 250 million users have now upgraded to Google+, which is the same number we heard during Google I/O last month.

Android: Google reiterated their announcements from Google I/O where they had stated that it is registering 12 new device activations every second and 1 million device activations on a daily basis, a significant increase from 400,000 daily device activations announced during the previous I/O. Google had also announced it has activated more than 400 million Android devices till now and the Android adoption rate has grew by over 500% over the past year in developing countries like India, Brazil, Indonesia, Thailand. Google Play Store now has 600,000 apps and is currently generating 1.5 billion installs per month and 20 billion total app installs.

ResultsConference Call Transcript on Seeking Alpha


The Lowdown: What Google Announced At I/O 2012
The Lowdown: Google I/O 2012 Day 2 – 310M Chrome Users, 425M Gmail Users & More

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