Google Q1 Exceeds Expectations Again
Internet search engine and ad network Google reported that first-quarter profits rose 69% over the same period last year — a result that CEO Eric Schmidt said made the company “ecstatic.”
Quarterly revenue, mostly from ad sales on Google search results pages and on its AdSense publisher network, was $2.53 billion, up from $1.53 billion in Q1 2006. Revenue on Google-owned sites increased 76% from a year ago to $2.28 billion. AdSense revenue was $1.35 billion for the quarter, a 45% jump year over year.
Paid clicks on Google sites and on ad network partner sites increased about 52% over the same quarter last year.
Schmidt stressed that, despite all the attention being paid to Google’s efforts to diversify its revenue streams into offline ads, desktop applications and the like, the company’s core business of search advertising has plenty of growth left.
“Sometimes I worry we spend so much time talking about new things, and we’re not focused on our core business, which is very strong,” he said in a conference call. “There’s still lots of room for growth in Internet ads.”
Asked why Google, which has essentially made the market in targetable search advertising, was now interested enough in online display ads to pay $3.1 billion for the DoubleClick graphical ad delivery platform, co-founder Sergey Brin said that the company saw large inefficiencies in display advertising that could benefit from its targeted approach.
“At the face of it, you would think, ‘Well, how complicated can it be?'” he said. “You just pick a good site for your ads and you just run them. But in fact, it turns out that there are many different Web sites, and there are many different users who use those Web sites in their different situations.
“Advertisers in many cases don’t have all the metrics information they need to decide which ads to run where. We have seen good success with that, and we think we can expand that to more broad kinds of media, not just static images.”
