Google reports 12% revenue increase
Google misses analysts' $17.5bn target but reports 3.7% profit increase through growth in mobile ad sales
Google has reported a 12% revenue increase of $17.3bn (£11.4bn) for the first quarter of 2015, compared with the same period in 2014. Profits rose 3.8% at $3.6bn.
Google narrowly missed the $17.5bn revenue figure analysts were expecting, according to Thomson Reuters. Last year the search engine reported $15.42bn for the same period.
After the results were released the company’s share price climbed 3.5% to $577.
The price of online cost-per-click ads declined 7%, while the number of clicks on Google's ads increased 13%.
Google reported that advertising accounted for 89.9% of revenues for Q1, making a total of $15.5bn – an increase of 11% year-on-year.
Google’s chief financial officer Patrick Pichette said mobile ads were key to the company’s growth in Q1: "We are experiencing real strength in mobile search," he said.
Senior vice-president and chief business officer Omid Kordestani identified two areas of emphasis for the company in the future.
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“First, the shift to mobile – and then the trend of TV budgets shifting to digital. Mobile devices are driving the huge shift in the way people consume media,” Kordestani said.
“You’ve heard about the trends many times. Here is our point of view. As we all know, consumers reach for their phones a lot, and some of these moments matter more than others, like when people are looking for answers or making a decision about what to buy or do.”
Earlier this month, the European Commission (EC) issued a statement of objections to Google, alleging it had abused its dominant position in the internet search services market and the Android mobile operating system (OS).
It is thought Google could be faced with a fine equating to about 10% of its most recent annual sales figures.
Kordestani said: “People expect to get exactly what they want, when they want it. As a company built on intent and immediacy, that’s good news for Google. Our job has always been to connect people with what they are looking for in the exact moment they are looking.
“Our ad products are a critical way we’ve delivered the right answers and the right moment, and it’s something we do really well. It’s often more valuable to know someone is shopping for a new SUV than it is to know basic demographic information about them.”