Google profits rise 30% despite disappointing revenues

By John Glenday | Reporter

January 30, 2015 | 2 min read

Google has brushed off the failure of its Google Glass system by posting a 30 per cent rise in fourth quarter profits to £3.16bn, despite revenues rising just 15 per cent to $18bn – below analysts’ estimates.

The rise of the dollar hurt Google’s final figures, depressing its revenues by as much as $541m due to unfavourable exchange rates.

Investors fret that Google is struggling to translate its desktop advertising success into the mobile arena, a sector which is rising to increased prominence as consumers switch from PCs to their smartphones and other mobile devices.

Jon Myers, managing director of ad tech platform Marin Software, commented: "Since Facebook upped its game on mobile, Google’s mobile ad share has fallen from over 50 per cent in 2012 to 40 per cent. But as the mobile market continues to expand, we expect Google will continue to go from strength to strength on mobile next quarter.

"The shift to mobile means the smart choice for advertisers in 2015 is still to optimise spend toward smartphones – we’ve seen that the rate of clicks goes up significantly every quarter, but the cost has remained low compared to both desktop and tablets.

"Consumers now use as many as 10 different platforms, channels and devices during the 20-30 days it takes to buy. Looking ahead, in addition to reaching consumers across different channels, the next advancement will be the ability to retarget across these different touchpoints."

Another bad omen contained in the results arose from the closely watched cost-per-click rate which Google can command for its advertising, this declined by 3 per cent over the quarter demonstrating the continued softness of mobile advertising.

Trending

Industry insights

View all
Add your own content +