The 10-second takeaway
For the quarter ended June 30 (Q2), Google beat expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share improved.
Margins dropped across the board.
Google reported revenue of $12.21 billion. The 33 analysts polled by S&P Capital IQ looked for sales of $11.11 billion on the same basis. GAAP reported sales were 35% higher than the prior-year quarter's $9.03 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $10.12. The 37 earnings estimates compiled by S&P Capital IQ predicted $10.10 per share. GAAP EPS of $8.42 for Q2 were 9.6% higher than the prior-year quarter's $7.68 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 59.0%, 590 basis points worse than the prior-year quarter. Operating margin was 26.2%, 570 basis points worse than the prior-year quarter. Net margin was 22.8%, 500 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $12.12 billion. On the bottom line, the average EPS estimate is $10.81.
Next year's average estimate for revenue is $47.01 billion. The average EPS estimate is $43.08.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 15,280 members out of 17,745 rating the stock outperform, and 2,466 members rating it underperform. Among 3,679 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 3,273 give Google a green thumbs-up, and 406 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 $741.11.
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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.