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Saturday, April 18, 2009

Google Revenue Drops, But Profits Are Still Rising

Posted by @ 7:54 pm

The hotly anticipated Q1 Google earning results was released this week and it highlighted the search giant was also feeling the economic pinch.

Google has reported record revenue and profit growth since inception many years ago. On this basis, industry analysts were keen to see whether Google could weather the economic storm that has already battered several other high profile companies’ earnings.

Below is a copy of the slide presentation of their earnings report.

As you can see, the company has experience the first drop in revenue since it launched back in 1998. It earned US$5.52 billion in Q1 2009, which represents a 3% decline from Q4 2008, but a 6% increase on Q1 2008.


While revenue dropped, Google posted a net profit of US$1.42 billion, a growth of 9% in Q1 2009. The profit growth was due in a large part to prudent cost management. This was evident in the termination of several unsuccessful services over the past few months.

Google CEO Eric Schmidt prefaced the earnings report with the following statement:

Google had a good quarter given the depth of the recession–while revenues were down quarter over quarter, they grew 6% year over year, thanks to continued strong query growth. These results underline both the resilience of our business model and the ongoing potential of the web as users and advertisers shift online,” said Eric Schmidt, CEO of Google. “Going forward, our priority remains investing for the long term to drive future growth in our core and emerging businesses.

While this presents a small bump in road for Google, they are positioned well to ride out the storm. Continued cost management and continued investment in long term strategic search and advertising improvement will see them come out the other side of this crisis as one of the few corporate success stories.

Rene LeMerle Rene is the marketing manager of - a global search engine marketing company. He also leads the marketing for - a web 2.0 style community for online and digital marketers. Rene has been in the industry since 1997 with much of that time spent helping businesses embrace the best of the internet and digital world.

View Rene LeMerle's profile

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