More on Google: Strong paid click growth offsets ad price weakness

Google's (GOOG) ad prices (cost per click) fell 4% Q/Q and 8% Y/Y in Q3, after dropping 2% Q/Q and 6% Y/Y in Q2. However, its paid clicks rose 8% Q/Q and 26% Y/Y, an improvement from 23% Y/Y growth in Q2 and 20% in Q1. While the mobile transition (and perhaps Enhanced Campaigns) continues to pressure ad prices, it's also giving a lift to search volumes.

Traffic acquisition costs fell to 24% of ad revenue from 25% in Q2 and 26% a year ago. International made up 56% of revenue, up from 55% in Q2 and 53% a year ago.

Google Sites revenue (68% of Google segment revenue) +22% Y/Y, up from +18% in Q2. Google Network revenue (3rd-party sites, 23% of total) only +1%, down from Q2's +7% and Q1's +12%, as stricter policies continue taking a toll. Other Google Revenue (inc. Nexus hardware and search appliances, 9% of total) +85%.

Motorola Mobility, which launched the Moto X and new Droid models, posted revenue of $1.18B, +18% Q/Q but -34% Y/Y. The unit had a $248M op. loss.

Opex +9% Y/Y and accounting for 34% of revenue vs. 35% a year ago.  Capex was $2.29B, up from Q2's $1.6B. Free cash flow was $2.79B, below net income of $3.64B. Headcount rose by 1.6K to 46.4K.

GOOG +5.9% AH. CC at 4:30PM ET.

Q3 results, PR, slides

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Comments (2)
  • Yesterdays_news
    , contributor
    Comments (2111) | Send Message
    Google's paid click is way up since they have been altering their search more and more to point to the larger sites that are swamped with Adsense ads and Google maps! I have been watching this slowly happen the last 2 years. Ask any small website owner or SEO expert and they will tell you the same. They also rank results differently for mobile and desktop to maximize income, not your search results.


    It is great in the short term for Google ad revenue, but not great for a fair and unbiased search using their search engine. How long will users be happy with altered search results?
    17 Oct 2013, 05:20 PM Reply Like
  • jnjguy
    , contributor
    Comments (6) | Send Message
    wow! i hope this means that FB will report just as amazing advertisement revenues.
    17 Oct 2013, 05:46 PM Reply Like
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