Google reported on Thursday that it had booked $10.65 billion in revenue during the first quarter of 2012 (1Q12), a 24 percent increase over the same period last year. Traffic acquisition costs took a $2.51 billion bite out of that figure.
Net income rose to $2.89 billion, a 60 percent increase over the $1.8 billion Google registered in 1Q12. On a non-GAAP basis, the figure rises to $3.33 billion.
Earnings per share (EPS) hit $8.75, based on 330 million undiluted shares and after taking traffic acquisition costs into account. Non-GAAP EPS came in at $10.08. Wall Street analysts were banking on $9.65 a share.
According to CEO Larry Page, Google's bets beyond search and advertising are starting to pay off. “We also saw tremendous momentum from the big bets we’ve made in products like Android, Chrome and YouTube," said Page. "We are still at the very early stages of what technology can do to improve people's lives and we have enormous opportunities ahead," he adds.
Google's sites continue to drive the majority of revenues, however, generating $7.31 billion for the company, or 69 percent of total revenues. Partner sites were responsible for $2.91 billion, or 27 percent of total revenues.
As of March 31st, the company sat atop a $49.3 billion war chest. That figure includes "cash, cash equivalents, and short-term marketable securities." Google was subject to an effective tax rate of 18 percent in 1Q12.
Co-founders Larry Page and Sergey Brin used the occasion announced that Google is instituting a new class of stock that essentially translates into a 2-for-1 stock split. Page and Brin spilled the details in their 2012 Founders' Letter to investors.
They wrote, "Today we announced plans to create a new class of non-voting capital stock, which will be listed on NASDAQ. These shares will be distributed via a stock dividend to all existing stockholders: the owner of each existing share will receive one new share of the non-voting stock, giving investors twice the number of shares they had before."
Acknowledging that the decision won't sit well stockholders that are fans of "more traditional governance models," the founders explain that the decision was made to maintain a founder-led approach to running the company. They add, "Having the flexibility to use stock without diluting our structure will help ensure we are set up for success for decades to come."
Simply put, Page and Brin remain firmly in control of Google's destiny.
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