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January 19, 2012 – Google Inc. (NASDAQ: GOOG) today announced financial results for the quarter and the fiscal year ended December 31, 2011.
Google had a really strong quarter ending a great year. Full year revenue was up 29%, and our quarterly revenue blew past the $10 billion mark for the first time,” said Larry Page, CEO of Google. “I am super excited about the growth of Android, Gmail, and Google+, which now has 90 million users globally – well over double what I announced just three months ago. By building a meaningful relationship with our users through Google+ we will create amazing experiences across our services. I’m very excited about what we can do in 2012 – there are tremendous opportunities to help users and grow our business.”
Google reported revenues of $10.58 billion for the quarter ended December 31, 2011, an increase of 25% compared to the fourth quarter of 2010. Google reports its revenues, consistent with GAAP, on a gross basis without deducting traffic acquisition costs (TAC). In the fourth quarter of 2011, TAC totaled $2.45 billion, or 24% of advertising revenues.
Quarterly revenues broke the $10bn mark for the first time – at $10.58bn they were up 25 per cent on the last quarter of 2011 – but this was still below analyst’s estimates. Earnings-per-share was $9.50, about a dollar short of where Google had been hoped to be.
What’s particularly worrying Wall Street is Google’s continuing reliance on advertising for the vast bulk of its revenue, coupled with a steady drop in the cost-per-click price – the amount Google charges advertisers. This fell 8 per cent in the last quarter, on top of an 8 per cent drop the previous quarter. Annual costs were also a couple of percentage points higher.