Google Revs Rise To $15B; Feels CPC Pressure

Google reported revenue for the quarter, end March 31, 2014, rose 19% to $15.42 billion, compared with the year-ago quarter. The cost per click on Google's sites and those of its partners fell 9% year-over-year. Good news for advertisers, bad news for investors.

Aggregate clicks related to paid search ads served on Google sites and the sites of it network partners rose 26% during the first quarter of 2013 and decreased approximately 1% over the fourth quarter of 2013.

The company's sites generated revenue of $10.47 billion, or 68% of total revenue, in the first quarter of 2014, up 21%. That compares with the first quarter of 2013 sites revenue of $8.64 billion.

Partner sites generated revenue of $3.40 billion, or 22% of total revenue, up 4% over first quarter of 2013 network revenue of $3.26 billion. Other revenue came to $1.55 billion, or 10% of total revenue, in the first quarter of 2014, up 48% compared with the year-ago quarter.

Revenue generated from outside of the United States totaled $8.76 billion, representing 57% of total revenues in the first quarter of 2014, compared with 56% in the fourth quarter of 2013 and 55% in the first quarter of 2013.

The average cost per click fell in the quarter. That's good news for advertisers; bad news for investors.

The average CPC related to ads served on Google sites and the sites of its network partners fell 9% during the first quarter of 2013 and remained constant from the fourth quarter of 2013. The company said during the earnings call Wednesday that in Q2 it would separate CPCs and clicks by its sites and its partner businesses. 

The portion of revenue shared with Google's partners, rose to $3.23 billion in the first quarter of 2014, compared with $2.96 billion in the year-ago quarter. As a percentage of advertising revenue, the portion fell to 23% in the first quarter of 2014, down from 25% in the first quarter of 2013.

During the quarter, Google entered into an agreement with Lenovo Group Limited to sell the Motorola Mobile business. The financial results are noted as a "Net loss from discontinued operations" on the Consolidated Statements of Income. Assets and liabilities they receive are are presented as "Assets held for sale" and "Liabilities held for sale," respectively, on the Consolidated Balance Sheet as of March 31, 2014.

The company also issued shares of Class C capital stock on April 2, as a dividend to stockholders. Except for the number of authorized shares and par value, all references to share and per share amounts have been retroactively restated for all prior periods shown to reflect the stock split, which was effected in the form of a stock dividend.

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1 comment about "Google Revs Rise To $15B; Feels CPC Pressure".
  1. Mike Einstein from the Brothers Einstein , April 17, 2014 at 9:29 a.m.
    Laurie, "The average cost per click fell in the quarter." Fell to what?