After posting a rare miss in January, Google
Under closer inspection, there are plenty of moving parts in Google's business model. Paid clicks jumped 39%, but the average cost per click fell 12%. Both trends are accelerating compared with the previous quarter's 39% growth and 8% drop, respectively. Traffic acquisition costs, which is the portion of ad sales Google pays out to its partners, kept pace with the overall revenue growth at 23%.
CEO Larry Page said that this is an "exciting time to be at Google." Big bets like YouTube, Android, and Chrome are all pushing Google forward.
But it's easy to overlook the actual results in the shadow of another big Google announcement. The company is about to replace its awkward dual-class stock structure with an even weirder triple-class model.
If this proposal passes muster at this summer's shareholders' meeting, every Google share in the existing single-vote Class A or super-voting Class B categories will be joined by an equal number of nonvoting C shares. The idea is to protect the current ownership structure in the face of rising dilution, so that Larry, Sergey, and Eric will continue to wield absolute voting power. (On that note, expect the proposal to pass easily. The people who want it already own an absolute majority of the votes.)
Never mind that a similar effect could be reached with a more shareholder-friendly buyback program -- we're getting a 2-for-1 stock split and that's that. But hey, maybe Google is saving its pennies for a dividend, like Apple
So if Google's shares run into some choppy trading here, now you know why: Great results were balanced out by an ugly accounting move that reminds me of Facebook's self-serving policies more than anything else. It'll take some time for the markets to digest these conflicting data points properly.
This earnings season is just getting started. Keep a close eye on the results from these five bellwethers.
Fool contributor Anders Bylund owns shares in Google but holds no other position in any of the companies mentioned. Check out Anders' holdings and bio, or follow him on Twitter and Google+. The Motley Fool owns shares of Google and Apple. Motley Fool newsletter services have recommended buying shares of Google and Apple. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.