Google Discloses Revenue Breakdown
Google Discloses Revenue BreakdownOct 18 2010 - Google - Farhad Divecha
For the first time ever, Google has provided a breakdown of the revenue generated by various sections of their business.
When the company recently announced their earnings for the third quarter of 2010, they disclosed earnings from the display advertising, YouTube and mobile sectors of their business. CFO, Patrick Pichette, clarified that this may very well be a one-time disclosure that they are making, and they do not intend to do this on a regular basis.
The breakdown of earnings was not provided for any altruistic reasons. In fact, it was meant to prove to their detractors that search is not the only revenue-generating section of their business and that other sectors are making money as well.
Display advertising has had an annualised run rate of almost $2.5 billion. Google had earlier referred to display advertising as their next billion-dollar business, and it looks like they have already achieved that. Of course, a large part of the display ad business has come from DoubleClick, which Google acquired fora hefty price tag of $3.1 billion.
As far as YouTube is concerned, specific revenue numbers were not made available, but it was clarified that YouTube is now monetising 2 billion page views per week, which is an increase of 50% compared to the previous year. Based on some recent reports, Ben Parr at Mashable concludes that YouTube should now be generating approximately $1 billion per year in revenue.
Google’s mobile business has had an annualised run rate of $1 billion this year, which is a very positive sign, and it is the mobile ad business which has been responsible for this growth, rather than the Android system which is available for free to companies.
In what can also be interpreted as yet another sign of growth, Google has also employed about 1,200 additional staff members, including about 300 through acquisitions and executives. They also intend to continue hiring more staff.
All of this extremely positive news has give the company’s stock a good boost of over 10% on the day following the earnings announcement. Share prices for GOOG went past the $600 mark today, reaching their highest point in the past 6 months.