Google (NASDAQ:GOOG) brought investors cheer by improving on dismal results from the previous quarter and reporting earnings that beat predictions. The company also announced a stock dividend for current investors that will introduce nonvoting capital stock.
The company’s earnings of $2.89 billion, or $8.75 per share, for the first fiscal quarter of the year bettered expectations of a profit of $8.23 per share. The $10.65 billion in revenue represented a 24 percent increase over the year-ago period. Google-owned sites generated $7.31 billion, which represented 69 percent of total revenues, while revenue from partner sites came in at $2.91 billion.
Revenue on Internet search ads increased 39 percent in the last 12 months, and was up 7 percent from the fourth quarter of 2011. Cost-per-click moved lower, down 6 percent from the previous quarter.
“We also saw tremendous momentum from the big bets we’ve made in products like Android, Chrome and YouTube,” chief executive Larry Page announced. “We are still at the very early stages of what technology can do to improve people’s lives and we have enormous opportunities ahead. It is a very exciting time to be at Google.”
More than half of the company’s revenue again came from overseas. Google announced it had a stockpile of $49.3 billion in cash, cash equivalents, and short-term marketable securities at the end of the quarter ended in March, and employed 33,077 full-time employees, up from 32,467 at the end of the last calendar year.
On top of giving its latest figures, the company used today’s earnings release as a platform to announce a stock split in which it will give current shareholders two shares for every share they own, effectively halving share prices in a move that will give the little guy a chance to own a piece of one of the largest Internet properties in the world. But there’s a catch.
The new shares will hold no voting powers, essentially giving the company’s founders — CEO Larry Page, Chairman Eric Schmidt, and co-founder Sergey Brin — more say in its management decisions. According to CNN, the company already has a dual-class share system that gives the founder 10 voters for every share they hold, which currently gives the three men a whopping 66 percent of the voting power over the company’s shares — and that’s without the split.
In a letter released to shareholders Thursday afternoon, the company’s co-founders said they’ve been growing concerned about day-to-day dilution from stock grants and acquisitions, which they believe could undermine that structure.”We have put our hearts in to Google and hope to do so for many more years to come,” Page, Brin, and Schmidt said in the letter. “So we want to ensure that our corporate structure can sustain these efforts and our desire to improve the world.”