Google credits mobile ads for strong earnings report
Google topped analyst expectations with a strong quarterly earnings report that the tech giant said was largely due to its mobile search business along with growth in YouTube and programmatic advertising.
The company reported $17.73bn in revenue, an 11 per cent increase from a year earlier. Excluding revenue given to advertising partners, the company reported a 13 per cent increase in revenue to $14.53bn, beating analyst expectations of $14.28bn according to Bloomberg.
It also reported an 11 per cent increase in ad revenues year-over-year to $16bn.
Ruth Porat, Google’s newly-hired chief financial officer, said: “Our strong Q2 results reflect continued growth across the breadth of our products, most notably core search, where mobile stood out, as well as YouTube and programmatic advertising.”
Porat joined Google from Morgan Stanley earlier this year where she held the same role. This past quarter was her first as chief financial officer of the company.
Cost-per-click - which is how much Google charges for its ads - was down 11 per cent. Paid click, or money that it receives per click, was up 18 per cent.
Google accounted for 31.4 per cent of digital ad spend globally last year, according to eMarketer, with its share expected to decrease to 31.1 per cent this year.
Facebook accounted for 7.9 per cent of worldwide digital ad spend in 2014. Total ad spend globally is expected to reach $170.9bn this year, up 16 per cent from last year, estimates eMarketer.
According to eMarketer, Google is still the dominant player in the search ad market with the marketing analytics firm expecting it to make up 54.5 per cent of search ad revenues worldwide this year. In terms of mobile, it is expected to make up 35.4 per cent of the mobile ad market in 2015 while Facebook is predicted to make up 16 per cent.