In an announcement Thursday, Google reiterated its stand that it is confident and will be undertaking further investments after its impressive second quarter performance. According to Patrick Pichette, Google Inc.’s Chief Financial Officer (CFO), the internet search giant had an impressive second quarter result, reinforcing its confidence that it can make more investing operations in both its central areas of business and emerging businesses. According to Google Inc, the second quarter of this year saw it employ an additional 1,200 employees amongst who were employees from Google’s acquired company, the mobile ad group AdMob and other acquisitions.
Growth in Its Core Business
Google Inc, based in Mountain View California further said through its CFO that it had made additional recruitment of staff that was biased on engineering and sales but also on particular product areas for which the company has core businesses such as search monetization, display, mobile and web applications. The chief financial offer said the above areas of business represent the next billion dollar businesses that are currently burgeoning fast, that being the reason behind Google’s interest in investing in them. He further reiterated Google’s position that such targeted growth areas investments are the right thing for the company given its current promising performance in the second quarter. Google Inc.’s chief financial officer, Mr. Pichette was talking at a conference call on Thursday after Google reported its impressive second quarter revenue earnings amidst disappointing adjusted earnings per share.
Higher Earnings Than Predicted
According to analysts, Google Inc’s operating expenses were higher than hoped peaking at 1.99 billion US dollars, about 29 per cent of revenues, a marked increase when contrasted against those of the second quarter last year that peaked at 1.54 billion US dollars and represented about 28 per cent revenues. At the same time, the internet search giant as well announced that its board of directors had permitted debt financing of 3 billion dollars via the allotment of commercial paper. In this regard, the company hopes the commercial paper will enable it put up a more robust and proficient capital structure that offers the company a low cost operating capital availability and flexibility. On the likelihood that the search giant might buy back shares, the company’s chief financial officer said Google had not made a decision on that in spite of the fact that regular debates are ongoing on the same.
Google’s shares went down by a margin of 20 per cent in 2010, way below those of the Nasdaq and other internet industry rivals such as Microsoft and Yahoo, coming in the wake of unease over Google’s growth rate, the intense regulatory scrutiny it has come under in Europe and the US, concerns over its capacity to rack in revenue from the mobile web and finally its problems with the Chinese government over censorship issues. The company had recorded profits of 1.84 billion dollars, representing a marked increase from its 2009 profits pegged at 1.49 billion.
In that regard, if the stock compensation costs are subtracted, the company’s profit went up per share to 6.45 dollars from 5.36 dollars. On the other hand, revenues went up from 5.52 billion dollars to 6.82 billion dollars.