Google's Strong Profit Driven By Wealthy Ad Business
Google's profit beat forecasts for the first time in the last six quarters, mainly boosted by strong advertising revenue. Google's expenses rose 10 percent to $12.9 billion in the second quarter ended June 30 from the year-ago quarter, and remained at 73 percent of revenue, the company said on Thursday. But expenses only grew by $91 million from the first quarter, and as a percentage of revenue declined by 1 percentage point.
"The decline in quarter-over-quarter operating expenses reflects, in part, discipline in expense management and, in part, lower legal expenses than in comparable periods," CFO Ruth Porat told analysts on a conference call.
Google's advertising revenue grew 11 percent to $16.02 billion from the year-ago quarter, while the number of ads, or paid clicks, rose 18 percent, the company said.
"Cost per click," or the average price of online ads, fell 11 percent, but was more than offset by the increase in ad volumes.
Google also said watch time for YouTube rose 60 percent in the second quarter and the video service roped in more viewers aged 18-49 than any U.S. cable network on mobile alone.