While the average cost-per-click (CPC) continues to decline, nearly everything else at Google is up – and growing in the double digits.
The 15-year-old company reached nearly $15 billion in revenue in Q3 2013, marking an 11 percent year-over-year increase to $14.89 billion. Google banked $2.97 billion in net income from that total, representing almost 27 percent in year-over-year gains.
Ad revenue from Google-owned websites jumped nearly 18 percent to $9.39 billion, while ad money from parter sites jumped a modest half percent to $3.14 billion. Overall, ad revenues jumped 13 percent from the same period a year ago, $12.54 billion.
The number of paid clicks served by Google and its partners is up 26 percent YoY. However, the average cost for each of those clicks is down 8 percent from last year and 4 percent from the previous quarter, according to Google, which also clarified that currency fluctuation is not to blame for the continuing drop in CPC.
More than half, or $7.67 billion, of Google’s revenue came from outside the United States in the just closed quarter. Revenue from abroad comprised 56 percent of Google’s total revenue during the quarter, up from 53 percent a year prior. Traffic acquisition costs also grew on a year-over-year basis to $2.97 billion, but dropped as an overall percentage of advertising revenues during the quarter to 24 percent.
“We are closing in on our goal of a beautiful, simple, and intuitive experience regardless of your device,” chief executive Larry Page begins on the call with investors. “For years, everyone talked about the multi-screen world. Now it’s arrived… screens are proliferating.”
Android powers a good amount of those screens; more than 1 billion to date and “more than 1.5 million devices are lit up every day,” says Page. The shift at YouTube is equally profound. “Almost 40 percent of YouTube’s traffic now comes from mobile, up from 6 percent two years ago,” Page adds.
Entertainment and consumer packaged goods (CPG) brands are also moving to YouTube in stride, growing more than 75 percent over the past two years, says Nikesh Arora, SVP and chief business officer at Google. As the company seeks to bring more brand advertisers online, it is striking partnerships with agencies and, for example, all of the top 10 global agencies are now using the DoubleClick product, he adds.
Commerce is another gigantic arena where Google’s role is evolving, and Page spent a few portions of the call discussing his goals within that opportunity. “We want to remove friction when people are buying online or in the real world,” he says. “We are working on many different pieces of the commerce experience. Right now the experience for consumers is not that seamless.”
Various pieces of technology and unconnected devices are required to make commercial transactions happen in most places today, he adds. Google wants to improve that, Page explains, and in an attempt to get there it needs to get the most accurate conversion data back to advertisers by closing the loop between multiple devices and varying paths to purchase.
Immediately after the earnings call, company stock hit an all-time high around $960, jumping more than 8 percent in after-hours trading. Google ended the quarter with 46,421 full-time employees and cash, or cash equivalents, totaling $56.52 billion.