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July 20, 2006

Google's Financial Results for Q2

"Google grew at an impressive pace during a seasonally slower quarter. [...] Our strong performance results from our clear focus on increasing the quality of user experience, particularly in search and ads," says Eric Schmidt, Google's CEO.

Google reported revenues of $2.46 billion for the second quarter, an increase of 77% compared to the second quarter of 2005 and an increase of 9% compared to the first quarter of 2006. The net income increased to $721.1 million, or $2.33 a share, from $342.8 million, or $1.19 a share, a year earlier.

Here you can see the advertising revenues (in thousands):

Three Months Ended
June 30,

Six Months Ended
June 30,

2006 2005
Advertising revenues:
Google web sites
Google Network web sites
Total advertising revenues
Licensing and other revenues
$ 1,384,495
$ 2,455,991
$ 2,641,011
$ 4,709,746

58% of the income is from the US, and 17% comes from the UK.

In their conference call, Google's representatives have given some idea about their plans:

* they'll launch AdSense for radio in 3 months worldwide

* they'll test mobile ads, first in Asia (Japan)

* increase the presence in countries where Google isn't the leader: China, Russia, Korea

* more partners for distribution and content

More at Google's press release. Conference Call transcript.


  1. " Total advertising revenues


    Hmm... Seems Google needs to win the search engine wars...

  2. Anon: That's in thousands, so its $4,654,720,000.

  3. Dr Nic, thats exactly why I said Google has to win the search engine wars.
    Not because they are loosing out, but because thats alot of money that they could loose out on.

    Google has no real backup, no goldmine that they can keep minning into the middle of the earth. Yes they have Google Mini and Google Earth etc... But tbh, thats tiny amounts of income (yes, 55mill is alot to you, but not to goog), without ad revenue, we will see the end of Google.

    They could charge for some of their free services? Pfft... Who will pay? A whole generation has now been made which expect Google products to be free.
    With MSN (owned by, tbh, the giants of all things computering), they have the deep pockets and endless goldmines they can keep digging into. They are spending $6b on research into searching. Google on the other paw (yes, im a dog) has ad revenue and share's. They dont have a massive product(s) which earn them billions every year. Windows Vista? Microsoft Office? Yes, these all will contribute to MSN's battle.
    Yahoo is also stepping up their game, no, not as much but it could still add pressure.

    If google loose, or even come second place, they will loose the incentive for people to pay for adwords. People will only pay (small businesses and organizations, maybe medium businesses) for the top search engine ad's. They wont pay for second best cause thats wasting money.