The 10-second takeaway
For the quarter ended March 31 (Q1), Google met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, both revenue and GAAP earnings per share expanded significantly.
Gross margin dropped, operating margin contracted, and net margin improved.
Google recorded revenue of $10.65 billion. The 29 analysts polled by S&P Capital IQ wanted to see revenue of $10.59 billion on the same basis. GAAP reported sales were 24% higher than the prior-year quarter's $8.58 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $10.08. The 36 earnings estimates compiled by S&P Capital IQ averaged $9.67 per share on the same basis. GAAP EPS of $8.75 for Q1 were 59% higher than the prior-year quarter's $5.51 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 64.4%, 140 basis points worse than the prior-year quarter. Operating margin was 31.8%, 80 basis points worse than the prior-year quarter. Net margin was 27.1%, 610 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $11.05 billion. On the bottom line, the average EPS estimate is $10.12.
Next year's average estimate for revenue is $47.22 billion. The average EPS estimate is $43.16.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 15,094 members rating the stock outperform and 2,473 members rating it underperform. Among 3,774 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 3,397 give Google a green thumbs-up, and 377 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Google is outperform, with an average price target of $718.49.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Google. Motley Fool newsletter services have recommended buying shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.