Google Announces Second Quarter 2010 Financial Results

Posted on July 18, 2010 by Steve Stafford

Google reported revenues of $6.82 billion for the quarter ended June 30, 2010, an increase of 24% compared to the second quarter of 2009. Google reports its revenues, consistent with GAAP, on a gross basis without deducting traffic acquisition costs (TAC). In the second quarter of 2010, TAC totaled $1.73 billion, or 26% of advertising revenues.

Google reports operating income, operating margin, net income, and earnings per share (EPS) on a GAAP and non-GAAP basis. The non-GAAP measures, as well as free cash flow, an alternative non-GAAP measure of liquidity, are described below and are reconciled to the corresponding GAAP measures in the accompanying financial tables.

• GAAP operating income in the second quarter of 2010 was $2.37 billion, or 35% of revenues. This compares to GAAP operating income of $1.87 billion, or 34% of revenues, in the second quarter of 2009. Non-GAAP operating income in the second quarter of 2010 was $2.67 billion, or 39% of revenues. This compares to non-GAAP operating income of $2.17 billion, or 39% of revenues, in the second quarter of 2009.
• GAAP net income in the second quarter of 2010 was $1.84 billion, compared to $1.48 billion in the second quarter of 2009. Non-GAAP net income in the second quarter of 2010 was $2.08 billion, compared to $1.71 billion in the second quarter of 2009.
• GAAP EPS in the second quarter of 2010 was $5.71 on 322 million diluted shares outstanding, compared to $4.66 in the second quarter of 2009 on 319 million diluted shares outstanding. Non-GAAP EPS in the second quarter of 2010 was $6.45, compared to $5.36 in the second quarter of 2009.
• 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 second quarter of 2010, the charge related to SBC was $309 million, compared to $293 million in the second quarter of 2009. The tax benefit related to SBC was $70 million in the second quarter of 2010 and $70 million in the second quarter of 2009. Reconciliations of non-GAAP measures to GAAP operating income, operating margin, net income, and EPS are included at the end of this release.

Source: http://investor.google.com/earnings/2010/Q2_google_earnings.html

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