Google misses earnings expectations, but revenue up

The stock plummets in after-hours trading after Google posts second-quarter revenue of $14.11 billion, up 19 percent over last year, but well below Wall Street's estimate.

Google

So much for Google $1,000 -- at least not in the near future.

In recent days, analysts have talked about shares of Google's surging stock breaking through the $1,000 barrier, but that was before the company announced its second quarter earnings report Thursday, which missed Wall Street's lofty estimates. Google reported revenue of more than $14 billion for its second quarter, showing investors a 19 percent increase from the same quarter last year, the company posted on Thursday.

Google said its net income for the second quarter was $3.23 billion, compared to $2.79 billion in the second quarter of 2012. Q2 ended on June 30. The company's earnings per share was $9.71, which is down from last year's $10.13. The $14.11 in revenue missed Wall Street's expectations of $14.41 billion and $10.78 a share.

Investors drove down Google's share price nearly 5 percent in after-hours trading. The stock closed the day at $911, down from the previous close of $919.

"The shift from one screen to multiple screens and mobility creates tremendous opportunity for Google. With more devices, more information, and more activity online than ever, the potential to improve people's lives even more is immense," CEO Larry Page in a press release.

Some of Google's revenue highlights:

• Revenue for Google-owned sites was $8.87 billion, which accounts accounts for 68 percent of total revenues. It's an 18 percent increase from Q2 of 2012, which had revenues of $7.54 billion.

• Google's partner sites generated $3.19 billion in revenues. This was 24 percent of Google's total revenues and was a 7 percent increase from 2012, which had $2.98 billion.

• Total advertising revenue went up 15 percent from $11,902 billion in Q2 of 2012, to $12,061 billion this year.

Some other key numbers from Google's Q3:

• The employee count has shifted now that Motorola Home is gone: On a worldwide basis, Google employed 44,777 full-time employees (40,178 in Google and 4,599 in Motorola Mobile) as of June 30. That's compared to 53,891 full-time employees (38,739 in Google, 9,982 Motorola Mobile, and 5,170 Motorola Home) as of March 31.

• Motorola posted an operating loss of $342 million -- 75 percent wider than its year-earlier hit.

• Google has activated more than 900 million Android devices to-date with 1.5 million more everyday.

• Chrome has 750 million users worldwide and growing.

• Advertisers have upgraded more than 600 million campaigns amid biggest change ever to AdWords.

• Google Play has seen 50 billion app downloads.

Last update, 2:40 p.m. PT: This story was updated multiple times to include more information.

Correction, July 19, 1:38 p.m. PT : The number of app downloads stated previously was incorrect. Google Play has seen 50 billion app downloads.

Rachel King contributed to this report.

 

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