On July 19, online biz wiz Google (Nasdaq: GOOG ) released second-quarter earnings for the period ending June 30, 2007.
• You may see this quarter called an earnings miss elsewhere, but keep in mind that the company issues no earnings guidance, so the miss would be against the average educated guess of analysts. The company still increased revenue by 57.7% to $3.9 billion year over year.
• Costs ran away for the company a bit, as it went on a quarter-long hiring binge. There are now nearly 13% more Googlers on payroll than at the end of last quarter, so now CEO Eric Schmidt has promised to rein in the recruiting rampage somewhat.
• Google is a two-star stock in CAPS. Fellow Internet giant and Motley Fool Stock Advisor recommendation Yahoo! (Nasdaq: YHOO ) -- which reported earnings earlier this week -- also ropes in two out of five stars.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q2 2007 |
Q2 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$3,872 |
$2,456 |
57.7% |
|
Net Profit |
$925 |
$721 |
28.3% |
|
EPS |
$2.93 |
$2.33 |
25.8% |
|
Diluted Shares |
315.5 |
310.0 |
1.8% |
Get back to basics with the income statement.
Margin Checkup
|
Q2 2007 |
Q2 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
59.7% |
59.7% |
(0.0) |
|
Operating Margin |
28.5% |
33.2% |
(4.7) |
|
Net Margin |
23.9% |
29.4% |
(5.5) |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q2 2007 |
Q2 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$12,504 |
$9,822 |
27.3% |
|
Accounts Rec. |
$1,649 |
$885 |
86.3% |
|
Liabilities |
Q2 2007 |
Q2 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$136 |
$179 |
(23.9%) |
|
Long-Term Debt |
$0 |
$0 |
N/A |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
Q2 2007 |
Q2 2006 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$1,230 |
$841 |
46.3% |
|
Capital Expenditures |
$575 |
$699 |
(17.7%) |
|
Free Cash Flow |
$655 |
$142 |
362.5% |
|
$573.3 |
$148 |
287.4% |
Free cash flow is a Fool's best friend.
Related Foolishness:
- Foolish Forecast: No Google? Know Google!
- Fool Video: Was YouTube a Good Deal for Google?
- Go, Go, Google Hybrid!
- Foolish Fundamentals: Valuation
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
Yahoo! is a Stock Advisor pick. To see what else is cooking in Tom and David Gardner's kitchen, try a free 30-day trial today.
At the time of publication, Anders Bylund was a Google shareholder with a taste for more of that sweet G juice. All things considered, he's still a happy shareholder and can only shake a timid fist at our Foolish disclosure and trading policies for forcing his mouse pointer away from that "buy" button. Fool rules are here, whether you want them or not.
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