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Google Surges Afterhours On Big Top And Bottom Line Beat
Don't write Google off just yet. The company, which had left many wondering if it can continue to compete with the same level of intensity, just crushed consensus, with Q3 EPS of $9.72 beating expectations of $8.76, while revenues coming at 9.72$ billion on expectations of $7.23 billion. Cash of $42.6 billion, not quite Apple but still lots of potential acquisition targets.. Immediate result: stock up $40 after hours. From Page: ""We had a great quarter. Revenue was up 33% year on year and our quarterly revenue was just short of $10 billion. Google+ is now open to everyone and we just passed the 40 million user mark. People are flocking into Google+ at an incredible rate and we are just getting started!" Some other details from the press release...
- Q3 Net USD 2.73bln vs. Exp USD 2.86bln
- Q3 paid clicks rose 28% vs. year ago
- Q3 average cost-per-click rose 5% vs. year ago
- Q3 sites revenue USD 6.74bln
Q3 Financial Summary
- GAAP operating income in the third quarter of 2011 was $3.06 billion, or 31% of revenues. This compares to GAAP operating income of $2.55 billion, or 35% of revenues, in the third quarter of 2010. Non-GAAP operating income in the third quarter of 2011 was $3.63 billion, or 37% of revenues. This compares to non-GAAP operating income of $2.93 billion, or 40% of revenues, in the third quarter of 2010.
- GAAP net income in the third quarter of 2011 was $2.73 billion, compared to $2.17 billion in the third quarter of 2010. Non-GAAP net income in the third quarter of 2011 was $3.18 billion, compared to $2.46 billion in the third quarter of 2010.
- GAAP EPS in the third quarter of 2011 was $8.33 on 327 million diluted shares outstanding, compared to $6.72 in the third quarter of 2010 on 322 million diluted shares outstanding. Non-GAAP EPS in the third quarter of 2011 was $9.72, compared to $7.64 in the third quarter of 2010.
- Non-GAAP operating income and non-GAAP operating margin exclude the expenses related to stock-based compensation (SBC). Non-GAAP net income and non-GAAP EPS exclude the expenses related to SBC and the related tax benefits. In the third quarter of 2011, the charge related to SBC was $571 million, compared to $380 million in the third quarter of 2010. The tax benefit related to SBC was $116 million in the third quarter of 2011 and $85 million in the third quarter of 2010. Reconciliations of non-GAAP measures to GAAP operating income, operating margin, net income, and EPS are included at the end of this release.
Revenues – Google reported revenues of $9.72 billion in the third quarter of 2011, representing a 33% increase over third quarter 2010 revenues of $7.29 billion. Google reports its revenues, consistent with GAAP, on a gross basis without deducting TAC.
Google Sites Revenues - Google-owned sites generated revenues of $6.74 billion, or 69% of total revenues, in the third quarter of 2011. This represents a 39% increase over third quarter 2010 revenues of $4.83 billion.
Google Network Revenues - Google’s partner sites generated revenues, through AdSense programs, of $2.60 billion, or 27% of total revenues, in the third quarter of 2011. This represents a 18% increase from third quarter 2010 network revenues of $2.20 billion.
International Revenues - Revenues from outside of the United States totaled $5.3 billion, representing 55% of total revenues in the third quarter of 2011, compared to 54% in the second quarter of 2011 and 52% in the third quarter of 2010. Excluding gains related to our foreign exchange risk management program, had foreign exchange rates remained constant from the second quarter of 2011 through the third quarter of 2011, our revenues in the third quarter of 2011 would have been $53 million lower. Excluding gains related to our foreign exchange risk management program, had foreign exchange rates remained constant from the third quarter of 2010 through the third quarter of 2011, our revenues in the third quarter of 2011 would have been $483 million lower.
- Revenues from the United Kingdom totaled $1.05 billion, representing 11% of revenues in the third quarter of 2011, compared to 12% in the third quarter of 2010.
- In the third quarter of 2011, we recognized a benefit of $1 million to revenues through our foreign exchange risk management program, compared to $89 million in the third quarter of 2010.
A reconciliation of our non-GAAP international revenues excluding the impact of foreign exchange and hedging to GAAP international revenues is included at the end of this release.
Paid Clicks – Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of our AdSense partners, increased approximately 28% over the third quarter of 2010 and increased approximately 13% over the second quarter of 2011.
Cost-Per-Click – Average cost-per-click, which includes clicks related to ads served on Google sites and the sites of our AdSense partners, increased approximately 5% over the third quarter of 2010 and decreased approximately 5% over the second quarter of 2011.
TAC - Traffic acquisition costs, the portion of revenues shared with Google’s partners, increased to $2.21 billion in the third quarter of 2011, compared to TAC of $1.81 billion in the third quarter of 2010. TAC as a percentage of advertising revenues was 24% in the third quarter of 2011, compared to 26% in the third quarter of 2010.
The majority of TAC is related to amounts ultimately paid to our AdSense partners, which totaled $1.83 billion in the third quarter of 2011. TAC also includes amounts ultimately paid to certain distribution partners and others who direct traffic to our website, which totaled $383 million in the third quarter of 2011.
...
Cash Flow and Capital Expenditures – Net cash provided by operating activities in the third quarter of 2011 totaled $3.95 billion, compared to $2.89 billion in the third quarter of 2010. In the third quarter of 2011, capital expenditures were $680 million, the majority of which was related to IT infrastructure investments, including data centers, servers, and networking equipment. Free cash flow, an alternative non-GAAP measure of liquidity, is defined as net cash provided by operating activities less capital expenditures. In the third quarter of 2011, free cash flow was $3.27 billion.
We expect to continue to make significant capital expenditures.
...
Cash – As of September 30, 2011, cash, cash equivalents, and short-term marketable securities were $42.6 billion.
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19% effective tax rate too, must be nice.
err..Isn't it more like 9%. Google uses the double Irish, and the dutch sandwich, to not pay taxes. So less $$$ for our education system, but it's ok, google has a lot of H1B Visas to help talent immigrate.
Tell the idiots in US "education" system to get their asses to a library and read. You already spend more money per pupil than anyone else. The US should learn to compete again instead of just blaming someone else for their inadequacy.
Google is the pure and unadulterated essence of evil.
If you use their services they track everything you do with a level of granularity that boggles the mind. They gather the data and they store it permanently and in due course will sell it to the highest bidder or it will be at some future point confiscated.
Just like FaceBook.
And by the way, the google tracking cookies get into your system even if you are not directly using Goggle. Check you cookies when using Zero Hedge too! Employ anti spyware software.
I'm not a user of Twitter google , nor Facebook yet
Google Analytics.
Twitter Button
Google #1
and more are blocked when opening a page on this site.
Edit : Halogen Network ( whatever that is ) cookie also from ZH pages
Well then, you're really going to enjoy hearing this.
The city manager for the city near me is looking to convert as much of their digital infrastructure to Google apps as they can. He's been meeting with people from Google for a few months now. I haven't heard many details yet from friends who work there, but Gmail is going to be the first step.
Want to be anonymous? get off the grid and don't use the internet at all. As a sys-admin, I can tell you that anybody can be tracked.
No they can't. All you have to do is let them track you. And then let them not track you. As long as they think they are tracking you then they think you are just "gone" when they are not tracking you.
"We live in a sea of air"
Watch out for sharkers.
http://www.wifi-link.com/product.php?action=product&class1_id=602&class2...
You know 1 mile free air N wireless will probably never happen. But 2500 foot through walls and trees g is pretty fun.
But problem is when you go capture mode and you can pick up 25 frikkin wireless network and actually get packets out of 18 of them.
And once everybody gets on board with having wireless antennas that weigh 40 lbs people could just force them to accept ad-hoc networks that consist of aggregates of thousands and even hundreds of thousands of people.
Google would have a hard time "feeding your reality back to you" when it's dealing with 100k sybil personalities.
Quite right, and much worse.
Google was developed with CIA seed money, and censors websites from search results to murder political dissidents who criticise the US regime on the topics the US most fears to be exposed ... like the bribery of US judges, and the way that Google itself, and Wikipedia, are both CIA projects ... Google Inc. now facing heavy fines from the EU Commission for its role in defrauding European governments and people, and helping US criminals to slander and try and murder European citizens:
EU Report, Google Inc. Anti-Competition Crimes & Deception
http://www.indymedia.nl/nl/2011/07/77181.shtml
(Original in pdf format:)
http://eureportsnonzionistjews.hostfile.nl/file/0zndj5ea3v/410/nzjd-eu-r...
Live Photo: Google Inc. Caught Censoring EU Search Results - Google computers admitting to blocking 19 websites from search results, so Google can pump lies about a topic into the top spot:
Google Internet Censorship - Censure d'Internet par Google - Internet censuur door Google
http://www.flickr.com/photos/22325431@N05/6100668211/in/photostream
For clear and undeniable proof of Google's evil, you need not look further than their YouTube, where easily half the videos I point to from my site have comments turned off (or weirdly disabled, which you only discover once you try to post a comment).
=> our BS media keeps bashing China (+ supporting western companies) for censoring the web, but keeps mum about Google doing the exact same for its Zionist / psy-ops masters? There's no evil here, move along now...
Well you could argue Google is a product of the US education system. On the other hand you could argue that google is...based in the USA and the product of the US education system. What are from again?
Dorm Room,
Yes, as we type IRS is after their ass........................tired of the untaxed $$$$ going offshore.
Fixin to be GOOGLEIZED.(IRS (Bawney Fwank style).
Too bad. GOOG can afford to fight the IRS, has better attorneys, and has friends in higher places. I am not going to defend GOOG but GOOG makes money selling digital and transitory products - search results and disply ads. I don't know how the IRS or Congress can stop GOOG from licensing the algorithm that produces those results and ads to its foreign wholly owned subsidiaries. Some dude in Italy searches for a nice hotel to stay in on his trip to Bangladesh and the IRS expects a cut of the ad revenue? Right. The only thing the IRS is entitled to a piece of the revenue GOOG got for licensing the algorithm to its subsidiary. That could be as low as $1 for 99 years.
You can't stop intellectual capital from fleeing to the lowest cost environment. This is why the more the USA becomes dependent on its intellectual capital the more inclusive the tax code will have to be. IRS will not get much from GOOG the way it tries to now, and even the 9-9-9 plan is worse for GOOG that the double-dutch bus fighting irish but there are ways I am sure. Charge them 9% tax on their new servers at least.
Heck they may even sell their Android code to handset makers via foreign subsidiaries. I suppose if/when they do get into importing GOOG branded Taiwanese made electronics, they will start paying AAPL style rates on those handsets. But that will still be a small portion of their business, if they ever actually do make and sell significant volumes of hardware. The hardware they sell overseas, fahgettaboutit!
Jim Rogers says he's bearish on Ameikan education/
http://jimrogers-investments.blogspot.com/2011/10/i-am-bearish-on-american-education.html
The only reason they had such an increase is CNBS googling every article from ZH! They Simply cannot pass the ZH math test.....
There will always be some good companies, no matter how broken the system is.
Still a 6-bagger off its 2004 IPO price.
During which time we had the two worst global credit crisis in the last 75 years.
Another "one-decision" stock.....
Investing in an NSA/FBI/CIA start-up and supported company is generally a can't miss.
Just like Microsoft and Facebook?
Actually many start-ups were (and are) funded by various government grants and agencies especially those that do R&D in the artificial intelligence field. Darpa was a big funder and check out In-Q-Tel. That being said ... For a lot of tech firms getting that government grant meant that they could stay in existence and continue developing new technology. And now those same technologies are allowing people to exchange ideas and groups like #OWS to organize - kind of ironic ... methinks.
it's even up a bit, when priced in real money (gold/silver)!!!
Robo---This 'after the fact' quarterbacking is bull shit. What are your holdings as of 10-13-11 5PM est? I'll track their performance. Note: Saying 'same as Cramer or Kudlow' won't fly.
PS. I realize these holding are ficticious, but the objective is to hold you accountable.
Im starting to see why everyone is so annoyed with this piece-o-shit. Yeah, I said it.
Give him the holdings, fucko, unless youre scared to get your tit in the wringer.
That said, I agree.
Robo is the best Monday Morning QB ever on ZH. No one does it better. Now as for his picks before the games start.. that's another story.
And to think Microsoft turned the offer to buy them down. (.....) HAHAHAHAHAHAHA!!!! Greatest IPO ever. "Dutch auction"--anyone who says they're evil has very low standards on said subject.
the rev estimate was Ex-TAC, their Ex-TAC revenue was 7.51bn, so it wasnt that huge of a top line beat
Figured ZH would yell DOOOOOOOM again, but I guess the censors let a bullish story through.
With the actual market behaviour, don´t be so sure that this is bullish.
The real bullish story would be Goggle losing a lot of money and bailed out with taxpayers money
Well everyone on ZH figured you wouldn't shut up about how great the market is, so I guess ZH is even.
Just a couple trading sessions and it will be lower. People ready to short it or take profits is consensus now.
Damn, I sold my 600 calls before the closing bell.
I figured it would beat, but didn't feel like taking the risk since I already had a profit.
<heh, heh>
That's OK I bought them from you.......
And to think I didn't have money back in 2004 when it was sold at 125$ a share... and I knew it was a good deal...
Why can't Google take all that cash and give it to Occupation Wall street?
Greedy corporate types who are only interested in .... oh, wait a minute; these are liberal IT types who care about the poor. Never mind. Let's find some Wall Street and Oil execs to hang.
Well done, sold my shares after the pop last quarter. Still like the name and the core business keeps printing money. I'll probably buy again at their next anti-trust court case when shares are beaten down.
A company beats quarterly estimates....wow....never saw that before.
zzzzzzzzzzzzzzzzzzzzz
Why set the bar high when we can set it low and blow it out and blast all circuits on the way up?
this is like setting the bar at 40 feet. in the standing high jump. and making it with room to spare. moron. idiot. retard. numb nuts. bonehead. dumbkopf. sheiskopf. big nose. let's see--Gen X'er? WTF?
So now Google is up what $100 in the past five days? I'm thinking the earnings beat should have been priced in. Whatever looks like a 500 point day tomorrow. Still rather have Google going up than Apple, at least Google somewhat deserves it.
I found a great archive article on that seminal moment in 1999 that made all of this possible:
http://www.nytimes.com/1999/11/05/business/congress-passes-wide-ranging-...
Alas every warning in that article has come to pass. People like to blame it on the republicans but it was a major bipartisan raping of the American people by insiders that knew they would profit from it. Bill Clinton signed it and praised it.
Some nice quotes:
"Administration officials and many Republicans and Democrats said the measure would save consumers billions of dollars and was necessary to keep up with trends in both domestic and international banking."
"The opponents of the measure gloomily predicted that by unshackling banks and enabling them to move more freely into new kinds of financial activities, the new law could lead to an economic crisis down the road when the marketplace is no longer growing briskly."
"If anything, the supporters said, the new law will give financial companies the ability to diversify and therefore reduce their risks. The new law, they said, will also give regulators new tools to supervise shaky institutions."
''The concerns that we will have a meltdown like 1929 are dramatically overblown,'' said Senator Bob Kerrey, Democrat of Nebraska.
"The White House has estimated the legislation could save consumers as much as $18 billion a year as new financial conglomerates gain economies of scale and cut costs."
"Other experts have disputed those estimates as overly optimistic, and said that the bulk of any profits seen from the deregulation of financial services would be returned not to customers but to shareholders."
''If we don't pass this bill, we could find London or Frankfurt or years down the road Shanghai becoming the financial capital of the world,'' said Senator Charles E. Schumer, Democrat of New York.
Nice ADR.
Another quote:
''I think we will look back in 10 years' time and say we should not have done this but we did because we forgot the lessons of the past, and that that which is true in the 1930's is true in 2010,'' said Senator Byron L. Dorgan, Democrat of North Dakota. ''I wasn't around during the 1930's or the debate over Glass-Steagall. But I was here in the early 1980's when it was decided to allow the expansion of savings and loans. We have now decided in the name of modernization to forget the lessons of the past, of safety and of soundness.''
Not all is so rosy at Google it would appear:
IRS Probes Google’s Bermuda Tax Avoidance
October 13, 2011 The US Internal Revenue Service is auditing how Google Inc. avoided American federal income taxes by shifting profits to subsidiaries in Bermuda and other off-shore jurisdictions, Bloomberg is reporting today [Oct. 13].The agency is bringing “more than typical scrutiny to how the company valued software rights and other intellectual property it licensed abroad”, a source who requested anonymity because the audit isn’t public told the business and financial news service.
The IRS has requested information from Google about its offshore deals after three acquisitions, including its $1.65 billion purchase of YouTube, the source said.
The transfer overseas of these kinds of rights rights has enabled Google to attribute earnings to foreign units that pay lower taxes, Bloomberg News reported a year ago.
Bloomberg’s revelation that Google had funneled its profits to Bermuda to avoid American taxes caused a firestorm of controversy both in the US and Europe with politicians, political commentators and businessmen charging that the Internet giant was engaging in “morally reprehensible” behaviour.
“It [Google] exploits tax havens such as Bermuda to legally avoid taxation,” said one leading British media industry figure at the time, describing the US multinational’s actions as “profoundly unethical”.
-etc-
http://bernews.com/2011/10/irs-probes-googles-bermuda-tax-avoidance/
Wow, you'd think the IRS would think twice before messing with a CIA money-maker.
Has professional courtesy gone out the window?
Just trying to keep up appearances. Dont want to raise any suspicions, ya know?
The bull shi. , never ends. Here is proof http://finance.yahoo.com/q?s=xlf
This is the sort of success that isn't fair in Amerika. We need a new fairness doctrine.
Perfect timing. Just installed adblock to my chrome browser, dam tired of all those ads.
You can block stupid, animated avatars with it, too.
Thx
Eric Schmidt to IRS:
'We know where you've been. We can more or less know what you're thinking about.'
I.R.S. to Eric Schmidt/ " Your google earth satellite lease", isn't producing. WTF?
Obama and all the other nations where google is used should TAX GOOGLE ON THE INCOME THEY MAKE IN THE COUNTRY!!!
GOOGLE DOESN'T PAY INCOME TAXES IN EUROPE!!!
Yes, because as we all know, theft makes the world a better place.
Why, just look at how well it has worked to create an honest society in Greece.
Remember that bigshot from Tyco who is now playing hide the salami in a federal pen somewhere?
I met him at Tyco's offices in Bermuda. You should have seen the place - the size of a walk in closet - with room for his secretary and the CFO. All told it was maybe 200 square feet for all three of them. Oh, and lots of circa 1960's plywood panelling all over the place...
And that was supposed to be the world headquarters for a multinational congolomerate listed on the NYSE and worth tens of billions??
He was just running another scam - with Uncle Sam's blessings at the time...
Koslowsi doesn't belong in jail. They nailed him for avoiding NY taxes on some artwork. That shouldn't even be a crime.
Bullshit they don't. If you are domiciled in the USA you pay taxes wherever you do business. There is a question about "loop holes"...which should the US Congress wish it could be eliminated entirely at any time. The USA is not Europe however where you have Switzerland, Luxemborg, Monaco, Cypress, the tax free Principality of Tax-freeistan, etc...
crushed consensus LOL
How many governement agencies are involved in Google ? HUH ?
i bet google streets has a military and police version so they can track your ass faster and beat any consensus.
parasites
Expectations per WSJ earlier today:
Analysts expect Google to report revenue of $9.45 billion in the quarter, or $7.3 billion in sales (or “net revenue”), up some 30% from a year ago.
So they reported net revenues of $7.5 billion...which is a 2.7% beat. So this should translate into a minor stock price change?
i will be a 600$ stock again tomorrow.
Too big to swallow.
Tyler
I'm wondering if you have any new thoughts on MBIA? On September 15th, with MBI @ ~$8.50, you had suggested that it could get squeezed "volkswagen" style. It promptly fell to the mid $6's within two weeks.
After this really strong short-covering rally in financials over the last week, it reversed a bit, and now trades in the high $7's, but still underwater from your recommendation. I'm wondering if you're having second thoughts on MBIA? I would think that if it were to get squeezed, it would have happened last week along with many other financials.
Please don't view this as being critical. I, in fact, agreed with your post and bought some MBI around $8.25 shortly after your article. Your analysis made a lot of sense, and after doing more homework, I decided to give it a shot. I'm only asking because I've got some money in it, and bought it based on your analysis.
Thanks....
MBIA? Might as well play with a loaded gun.
Pennies in front of the bulldozer, my friend.
You just.... purchased the stock? Didn't option it? WTF?
You are asking the wrong person, you should ask the guys at Peloton, or whatever they call their shop now, they are the ones that wrote the article.
You're not fooling anyone Redneck Repugnicant. Nothing that comes out of your mouth is honest.
and everything that goes in your mouth has a flagellum.
You certainly like to ride around on my coattails, don't you? If I was lying and was trying to disparage Tyler, I wouldn't have agreed with his MBIA article, nor would I have admitted to losing money on the trade.
You will say whatever you need to support whatever point you are attempting to make. You will distort, pervert, obfuscate, and deceive as required.
Your coattails are as threadbare as your credibility, there's nothing left to ride.
Google+ did attract a large number of initial users but traffic is dismal:
http://technolog.msnbc.msn.com/_news/2011/10/07/8209170-google-traffic-drops-60-percent
From what I've seen most of those who use it are super-geeks or artists (apparently it has some nice features for visuals). I just don't see it taking off - reminds of their last attempt to corner the social network market (Orkut).
I'm both a geek and artist, but I couldn't get into Google+. I wanted to like it. I tried to like it.
I'm sure it'll have a small, loyal following just like cult bands and movies do. But the fact that Google so blantantly tries to big brother...it turns me off. Apparently if you don't turn off your computer's microphone they eavesdrop through that and send ads based on your in-home, private conversations. They are like pesty gnats. "Don't be evil"?? Ok, Google.
Whatever - less than two week member
The technology isn't there yet - still dealing with words on a page is difficult enough let alone transcribed speech. Are you trying to spread paranoia or are you really crazy?
Bullshit. I regularly allow my mic slot and camera slot to have access. I got traps set to see if it gets triggered. I got my microphone triggered several times over the last 6 days. But since there's nothing there. They eventually figured out I was fucking with them.
BTW. xfire services and any game that has mic communications built into it is a total fucking spook pump.
howd' you find out about all this?
adblock and ghostery add on for chrome = faster loading pages , no ads and no tracking
noscript is f'in sweet for how it also speeds up your machine, especially if, like me, you often accumulate dozens of open tabs.
=> particularly pleasant is blocking all the scripts from google-analytics (had to do that manually)
That being said, with the secret rooms they have at every ISP tracking copies of each and every packet sent and received on the wire, you have to go to far greater lengths to have any hope of even rough anonymity...
Noscript phones home and not to check for updates. I have all thier ip addresses.
Still fucking great. And at least they let thier program "give up" on phoning home.
But they definitely sell thier white list and blacklist.