(By Balaseshan) Search giant Google Inc. (NASDAQ:GOOG) reported a 11.2% increase in quarterly earnings on a 35% revenue growth and greater momentum in products like Android, Chrome and YouTube.
Despite pressure from forex headwinds and macro economic concerns, second-quarter results exceeded Street's expectations, sending its shares up 2.36% in aftermarket.
Profit grew 11.2% to $2.79 billion, while earnings per share (EPS) increased 9.6% to $8.42. Adjusted earnings rose to $3.35 billion or $10.12 per share from $2.85 billion or $8.74 per share.
Revenue climbed 35% to $12.21 billion. Excluding traffic acquisition costs, revenue rose to $9.614 billion from $6.916 billion. Analysts had expected a profit of $10.04 per share on revenue of $8.41 billion.
In the last two months, the consensus EPS estimates have dropped to $10.04 from $10.20 as the company remains exposed to the strengthening of the US dollar, which has the effect of depressing the dollar based value of foreign revenue.
Excluding gains related to foreign exchange risk management program, rates remained constant from last year, total revenue in the latest quarter would have been $350 million higher.
Google completed its acquisition of Motorola Mobility Holdings Inc. on May 22, 2012. The operating results of Motorola were included in Google's results from the acquisition date through June 30, 2012.
Motorola revenues were $1.25 billion ($843 million from the mobile segment and $407 million from the home segment), or 10% of consolidated revenues in the second quarter of 2012.
Google-owned sites generated revenue grew 21% to $7.54 billion, while Google's partner sites revenue increased 20% to $2.98 billion. Revenues from outside of the United States totaled $5.96 billion, representing 54% of total revenue in the latest quarter.
Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of Network members, increased about 42%, while average cost-per-click, which includes clicks related to ads served on Google sites and the sites of Network members, decreased about 16%.
On a worldwide basis, Google employed 54,604 full-time employees (34,311 in Google business and 20,293 in its Motorola business) as of June 30, 2012, compared to 33,077 full-time employees as of March 31, 2012.
"We can expect Motorola to continue to show some accounting variability, as is typical with the closing of such large transactions," said Finance Chief Patrick Pichette.
Meanwhile, software major Microsoft Corp. (NASDAQ:MSFT) reported a quarterly loss, as it took a $6.2 billion noncash goodwill impairment charge related to the acquisition of aQuantive Inc. Yet, the company's adjusted earnings and revenue came in better than market expectations. Shares rose 1.58 percent in extended trading on Thursday
GOOG closed Thursday's regular trading up 2.12% at $593.06. The stock has been trading between $480.60 and $670.25 for the past 52 weeks.