Seeking Alpha

Google -5.7% AH; ad prices stable, but paid click/hardware growth slows

  • After falling 2% Q/Q in Q4 and 8% in Q3 thanks to mobile softness, Google's (GOOG) cost per click (ad prices) was flat Q/Q in Q1. On a Y/Y basis, it fell 9%.
  • Paid clicks (boosted by mobile and product listing ads) grew 26% Y/Y, a slower clip than Q4's 31% but even with Q3. Traffic acquisition costs fell to 23% of revenue from 24% in Q4 and 25% a year ago.
  • Google sites revenue (68% of total) +21% Y/Y vs. +22% in Q4. Ad network revenue (22% of total, pressured by policy changes) +4% vs. +3%. Other revenue (10% of total, includes Nexus hardware and search appliances) grew 48%, down from Q4's 99%.
  • Google spent aggressively: Opex rose to 35% of revenue from 33% in Q4 and 31% a year ago. Capex was $2.35B (15% of revenue), up from $2.26B in Q4. Free cash flow was $2.05B, well below net income of $4.3B. Headcount (exc. Motorola) rose to 46.2K from 43.8K at the end of Q4.
  • Google had $59.4B in cash at the end of Q4, +$700M Q/Q. Its Q1 tax rate was just 18%.
  • Q1 results, PR
Comments (7)
  • thatsthetruthofit
    , contributor
    Comments (85) | Send Message
    Google is leading mainstream enterprise compute with cloud, data, messaging, mobile OS, tons of solutions. They're into the next level with investments in robotics, flying data centers, solar power, etc. Google is an innovation machine doing really cutting edge stuff.
    16 Apr, 04:47 PM Reply Like
  • aow
    , contributor
    Comments (125) | Send Message
    ya but if your numbers don't meet expectations your due a haircut. Perhaps if Google wants to avoid this sort of thing they could start providing guidance like every other major public company.
    16 Apr, 04:48 PM Reply Like
  • synchrogeddon
    , contributor
    Comments (197) | Send Message
    but still it doesn't make them that much money, at least not now
    16 Apr, 06:04 PM Reply Like
  • MrMatt
    , contributor
    Comments (1305) | Send Message
    GOOG has been a bit on the more expensive side for a while,


    When people think the growth is slowing it should slide down a bit, I see $500 as completely reasonable, however I don't expect it to slide to or below $400 for long, and I'd definitely want to pick up a bit more at that level.
    17 Apr, 08:14 AM Reply Like
  • fredbrooklyn
    , contributor
    Comments (155) | Send Message
    Google is now down 2 cents... panic panic
    16 Apr, 05:53 PM Reply Like
  • duhaus
    , contributor
    Comments (320) | Send Message
    -15 cents = nice discount . . pickin up more.
    16 Apr, 09:37 PM Reply Like
  • unproven
    , contributor
    Comments (21) | Send Message
    If Google drop based on Q1 it's a buying opportunity. If you can find a better tech company sell Google.
    17 Apr, 01:02 AM Reply Like
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