• by Laurie Sullivan  @lauriesullivan, July 12, 2011

Industry insiders expect Google to post gains in profit and sales when it reports second-quarter earnings Thursday after the U.S. financial markets close. Analysts have mixed views.

Google should have a strong quarter in the U.S. for paid search, estimates Roger Barnette, president at IgnitionOne, which tracks quarterly paid-search revenue from Google, Bing and Yahoo.

Barnette suggests paying attention to international growth and display advertising, as well as the potential in data exchange. He looks at paid search to determine whether the revenue growth is driven more by volume or cost per click. "It will tell us if Google is doing a better job monetizing page views," he said.

In the second quarter, Google took the majority of market share in search and display, according to a report published earlier this month by IgnitionOne. When it comes to search advertising budgets, Google took 80% share in the U.S., compared with Yahoo and Bing at 19% share. Google also dominated in other key search metrics, including impressions, clicks, click-through rates and eCPM.

IgnitionOne also estimates that Google's AdEx did well, taking 51% share of U.S. real-time bidding display spend, compared to Yahoo's Right Media at 49% share. This marks a significant jump in Google's market share in display advertising year-on-year.

Macquarie Securities Analyst Ben Schachter wrote in a research note to expect net revenue for second-quarter earnings to come in flat, sequentially, and earnings before interest and tax margins around 47. He forecasts more year-on-year growth and earnings from mobile use to drive revenue. Schachter wrote: "given GOOG's exposure to global ad budgets, the European debt crisis and broader macro issues remain key concerns."

During Google's earnings call, Schachter also expects to hear initial data on the Google+ launch.

Many of the social functions Google launched this year will not have an impact on earning for at least another quarter. Google leaped head on into social earlier this year with Google +1, followed by Google+, and on Tuesday launched the next phase of its Google Offers daily deals specials in New York and San Francisco, after a successful test flight in Portland, Oregon.

Macquarie Securities Analyst Ben Schachter wrote in a research note that mobile functions and integration into Android for Google Offers seems a "key point of differentiation," as opposed to Groupon and Living Social.

Global Equities Research Managing Director Trip Chowdhry estimates that Google+ now supports between 3 million and 3.5 million members, but some estimates put that number much higher. Recent reports put the number at 4.5 million. By the weekend that number could jump to 10 million or more.