Google's revenue falls short despite curbing price declines
Reuters
Published Oct 16, 2014 05:53PM ET
Google's revenue falls short despite curbing price declines
By Alexei Oreskovic SAN FRANCISCO (Reuters) - Google Inc's (O:GOOG) revenue fell short of Wall Street's expectations as growth in Internet advertising slowed in the most-recent quarter, offsetting a modest improvement in ad pricing, sending its shares down about 3 percent.
The total number of ads, or paid clicks, expanded by 17 percent in the third quarter. That was down from the 25 percent growth rate that Google delivered in the second quarter.
But online advertising rates, which have been mired in a multi-year decline, moderated slightly in the third quarter, declining 2 percent year-on-year. That marked an improvement from the 6 percent decline in "cost-per-click" or CPCs in the second quarter.
Shares of Google fell 2.7 percent to $510.11 in extended trading on Thursday.
"The CPC decline abated. That's a big positive," argued BGC Partners analyst Colin Gillis. "If CPCs flatline that's going to help the core meaningfully."
Google posted $16.52 billion in revenue for the three months ended Sept. 30, compared to $13.75 billion in the year ago period. Analysts polled by Thomson Reuters I/B/E/S were looking for revenue of $16.57 billion in the latest quarter.
Google ramped up its spending during the quarter. The company increased its headcount by roughly 3,000 employees, contributing to a 46 percent rise in research and development costs.
On Thursday, Google announced it had appointed Omid Kordestani its new chief business officer, replacing Nikesh Arora, who had departed a quarter ago to join Japan's Softbank Corp (T:9984). The chief business officer is considered a key position, overseeing all the company's revenue-generating activities and serving as a liaison to investors and Wall Street.
(Reporting by Alexei Oreskovic; Editing by Bernard Orr)
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.