Google Posts Q2 Bottom-Line Miss; Beats On Top Line

Google Inc.

shares rose sharply in after-hours action when the company posted a second-quarter top-line miss while beating expectations for revenue. Google's net earnings increased to $3.42 billion, or $4.99 a share, compared with $3.23 billion, or $4.77 a year earlier. Revenue grew 22 percent to $15.96 billion, from $13.11 billion a year earlier. Wall Street expected revenue of $15.62 billion. Excluding items, profits were $6.08, compared to $4.96 in the second quarter of 2013. Analyste expected adjusted earnings of $6.24. Traffic acquisition costs of $3.29 billion in the second quarter equaled 23 percent of advertising revenue. Paid clicks grew 25 percent and Google sites generated revenues of $10.94 billion, or 69 percent of total revenue and up 23 percent from a year earlier. Partner sites revenue grew 7 percent to $3.42 billion, or 21% of total revenue, while "other revenue" increased 53 percent to $1.60 billion, or 10 percent of total revenues Revenue from outside of the U.S. of $9.33 billion, represented 58% of total revenue and little changed from a year earlier. On a constant currency basis and excluding hedging gains, revenue would have been lower by $120 million.