In today's world, most companies span several regions and sell across the world. As Foolish colleague Morgan Housel notes, 10 years ago, less than a third of S&P 500 revenue came from outside the United States. Today, more than half of the S&P 500's growth comes from overseas. And that number is growing.

The truth is, investors regularly underestimate how much demand comes from abroad. More importantly, for large, multinational corporations that have already established a presence in their home markets, much of their future growth comes from foreign markets.

With that in mind, today we're looking at Google (Nasdaq: GOOG). We'll examine not only where its sales and earnings come from, but also how its sales abroad have changed over time. 

Where Google's sales are today
Today, Google collects 48% of its sales from its home United States market.

Source: Capital IQ, a division of Standard & Poor's.

Where Google's sales were five years ago
Five years ago, Google collected 61% of its sales from the U.S. market. The company has pushed hard into foreign markets but has had less success in emerging markets such as China, where Baidu (Nasdaq: BIDU) still reigns supreme, and Russia, where Yandex (Nasdaq: YNDX) is top dog, Google still dominates in most markets. It holds an even higher share in most European markets than it does stateside, and its share in India has stayed north of 80% in recent years. All of these booming foreign markets have driven international sales higher at a faster pace than Google's United States growth.

Source: Capital IQ, a division of Standard & Poor's.

Competitor checkup
One last point to check is how Google's footprint compares with some of its peers across the broader search industry.


Geography With Most Sales

Percent of Sales

Google United States 48.0%
Baidu China 99.8%
Microsoft (Nasdaq: MSFT) United States 58.0%
Yandex Russia 97.7%

Source: Capital IQ, a division of Standard & Poor's.

Google is the most geographically diversified of its peers. Yandex and Baidu are both working on expanding past their founding markets, but those efforts still constitute a slim amount of their total sales.

Google's sales by geography are relatively easy to understand, but Microsoft's are a bit more complex in comparison. The company keeps contracts with large multinational customers that might book sales within the United States, even though end revenue is really abroad. The important point to remember is that Microsoft's sales come mostly from packaged software, which is easily pirated. That keeps the company from sharing in computer usage gains in emerging markets. Google, on the other hand, makes money from having users connect to the Web, so its path to profits in emerging markets is much easier.

Even with a few roadblocks in countries like China and Russia, Google looks to have asserted its search dominance in most countries of the world. As Internet usage continues accelerating in emerging markets, that should bring a powerful new stream of revenues online for the search behemoth.

Keep searching
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