Google Inc. announced that its fourth-quarter sales that beat analysts estimates as retailers spent more on advertising during the Christmas holiday season, making up for lower ad prices.
The company made an official statement, saying that its revenue, excluding sales passed on to partners, rose by 11% and reached 13.6 billion dollars. Google Inc. also announced that its profit excluding certain items was 12.01 dollars a share. According to some data compiled by Bloomberg, the average estimates of some analysts projected sales of 13.4 billion dollars and profit of 12.25 dollars a share.
Larry Page, who is the Chief Executive Officer of the company is currently working on the mobile strategy of Google. The company is said to be leaving smartphone manufacturing due to the fact it is selling its Motorola handset unit to Lenovo Group Ltd in a 2.91-billion-dollar deal. The Motorola handset unit of the company posted an operating loss estimated to 384 million dollars.
However, according to Emarketer Inc., Google Inc. has managed to generate income from retailers targeting online shoppers, who proved to be quite useful and increased the e-commerce sales of the company by 15% to 61.8 billion dollars during the Christmas holiday season. The operating expenses of Google, excluding the cost of revenues, rose 14% and reached 5.5 billion dollars. The companys net income increased by 17% to 3.38 billion dollars.
One of the analysts working for S&P Capital IQ Inc. – Scott Kessler – said for Bloomberg: “The holiday shopping season online was strong to very strong. Google more than likely benefited from that.”
The ands prices within the companys major business decreased by 11% during the fourth quarter of 2013, compared with a 8-percent decline in the previous period. The number of clicks on ads increased by 31% compared with a gain of 26% in the earlier period, as reported by Bloomberg.
Collin Gillis, who is one of the analysts of BGC Partners LP said: “The fact that click pricing is declining so much means they still have work to do on mobile.”
Google has been upgrading its sales features lately. Last year an advertising service was introduced, hoping that it would encourage marketers to funnel more of their spending to wireless devices. Retail customers have also been pushed to spend more on product listing ads.
According to CNN Money, the current share price of Google Inc. is 2.57% up, and its one-year return rate is 1.31% up. The 42 analysts offering 12-month price forecasts for Google Inc. have a median target of 1,200.00, with a high estimate of 1,350.00 and a low estimate of 880.00. The median estimate represents a +5.69% increase from the last price of 1,135.39.
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