Jul 17, 2008

Google Should Report +$3.8B

As Google prepares to announce its 2nd quarter earnings – the expectation is that the company will deliver about $3.8B in Revenue. That said, a close examination of how it makes its Revenue figure will give a good indication of where the company is going.

One of the key’s to Google’s dominance is that it’s able to provide a clearly defined value proposition to its core customer groups –through the quality of its Search Engine and it’s adSense/adwords programs.

I’d be interested in find out how much revenue the company manages to drive through its adSense (contextual) model – vs. the regular bidded Search Model. It would be interesting to review the split between Revenue reported from US and ROW. Even more insightful to review the breakout in ROW revenue between UK, Germany, France and the rest of Europe.

Revenue growth has declined YoY from 52% to 45% in Q1, Google is still gaining more query share worldwide. If the Yahoo Deal pans out, one can expect that Google will increase revenue even further, as Yahoo’s European Customers will start to allocate more of their spend to Google.

Clearly, the Microsoft / Yahoo debacle has benefited Google while Yahoo has been the biggest Loser. A review of Google’s US/Intl Rev should give some indication of just how much of a problem both companies face, in making headway in Search.

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