Schmidt: Worst of recession is over; Google is hiring

Schmidt: Worst of recession is over; Google is hiring

Summary: Google exceeded Wall Street's expectations for the third quarter by reporting net income of $1.88 billion, or $5.

TOPICS: Google

Google exceeded Wall Street's expectations for the third quarter by reporting net income of $1.88 billion, or $5.89 per share, on revenue of $5.94 billion, up 7 percent from the same quarter a year ago. Excluding traffic acquisition costs, Google's revenue was $4.38 billion. Wall Street analysts had been expecting earnings of $5.42 a share on revenue of $4.24 billion. (Statement)

Adjusted for expenses, the company reported a net income of $1.64 billion, or $5.13 per share.

In a call with analysts, CEO Eric Schmidt said that the worst of the recession is behind us and that the company feels "confident about investing heavily in our future." The first investment will be in people. Yes, Google is stepping up its hiring across the company but particularly in engineering and sales, executives said during the call.

The second investment is in innovation, particularly in advertising. Schmidt noted that many advertisers have told Google that they want to spend more money on Google ads but are looking for new ways to advertise. In addition, mobile search has seen 30 percent growth and the company considers mobile to be an up-and-coming business division hat could use some investment boosts.

The other mobile business - the Android mobile OS - has also come a long way from one carrier, one device and one country a year ago to 12 devices in 26 countries with 32 carriers today, with more on the way. Executives played up Android on the call, with Schmidt saying that "Android adoption is literally about to explode."

As for the widely anticipated delivery of the open-source computer operating system, called Chrome. Schmidt said the internal demos he's seen are showing "materially significant achievements in platform computing" that's different from the incumbents. There should be a version available later this year so developers can start playing with it.

The company also announced the Double Click ad exchange during the quarter - a key part of "opening the display ad ecosystem." One of the biggest investments in the quarter was an overhaul to AdWords and a shift to a new user interface that allows users to run their campaigns more efficiently and process new reports.

The company also took a moment to show how investments in different business categories all tie together. Consider what's going to be offered to small local businesses. The company is looking at new ad formats and recently has been testing a local listing ads in San Francisco and San Diego, which allows users to sign-up with a single form, pay a flat monthly rate and not worry about keywords or bids. Users can also get a free Web page that allows potential customers to call a business using Google Voice, which in turn, allows users to track how many calls were received as a result of the ad.

On top of that, Google is also looking at enhancements at its Maps business, including looking at the differences between what tourists might be looking for in a map, compared to what a local person want need - and how that might play into the results or ads for a business

Shares of Google were down about 1 percent in regular trading, closing at $529.91. Shares were rising in after-hours trading.

Topic: Google

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  • The longer the denial

    the more the smack of reality hurts. We aren't anywhere near coming out of this recession yet.
  • RE: Schmidt: Worst of recession is over; Google is hiring

    I'm happy for Google and, if Schmidt is right, for us. It's a
    great company with great products and true innovation. As
    the economy recovers and advertising dollars can further fuel
    innovation, I'm looking forward to Google making Microsoft
    less and less relevant in the future--or at least that Goliath
    should be cut down to size.
    • That "Goliath"?

      Just what exactly is the right "size" for Microsoft to be? And who should have the right to "cut (them) down to size"?

      Regardless of how much you like or don't like a private corporation, it does not give any entity the right to constrain it, save the free market.
      • save the free market

        Why would you say that a free market is an entity with rights? The free market is a mechanism for allocating resources. We, as people, have rights. Institutions do not have rights, expect to the extent that they are a group of people. We, as people, also have the right to demand certain behaviors in corporations. Microsoft has repeatedly violated anti-trust laws. Breaking laws must have consequence.

        My feeling on the first 'Golath' post is that Google is no longer a 'David', this is more a of a battle of the Titans. I tend to like Google more than MS, but I still have a sense that Google is getting too invasive and needs to face rather strict laws about how it uses it unprecedented data on millions of people.
  • Stimulus = Artificial high

    Economy cannot be stimulated, which is sth neither Bush nor Obama understood. The current depression was hangover of the past bad stimuli. If you have hangover you understand it's b/c you drank too much. When it comes to government they say you had a hangover b/c you stopped drinking so they decide to give you some more alcohol, which means more hangover down the road.
    • Postponing the inevitable

      They just want to create the illusion of prosperity and then push the problem off so that the next administration has to deal with it.

      So the govt either prints money (counterfiting) or they steal from future generations (social security)--either way the scam can only go on for so long.
      • Agreed

        ...and we're making things worse by monetizing our own debt. Who in their right mind, much less any economist with basic Econ 101, thinks that buying your own debt is a good idea?

        And printing more money isn't the answer either; kinda like just because I have checks in my checkbook doesn't mean I have money in the bank.

        Something is seriously wrong in the People's House.
  • What do executives know?

    I love it how Ballmer and now Schmidt talk about the economy and say that the worst is over.

    This is purely their uninformed opinion.

    Just what evidence do either of them have that things are improving?
    • uninformed!?

      Schmidt is sitting on top of an organization that does analytics as well as anyone. He is noting that, from Google's perspective, the worst of the downturn is ending. Google is seeing a billion more in revenue last quarter than analysts expected.

      I don't think he is trying to be a Cassandra for the economy as a whole. Google is exploring and delivering on a wide range of new technologies. It seems to me that these new technologies are largely decoupled from the housing and financial calamities that rocked the economy as a whole. So Google can be poised for growth, even if the economy as a whole is not. Schmidt may be bullish, but he is not uninformed.
  • RE: Schmidt: Worst of recession is over; Google is hiring

    Let him keep telling himself that, as he jets his way over flyover country where thousands of men and women are out of work, their unemployment benefits are running out, and they're worried sick about how they are to support their families.

    At the least irresponsible, at worst, a shill for the Obama administration.
  • RE: Schmidt: Worst of recession is over; Google is hiring

    Here's the plan: Rumor the economy way up and improving.
    Slowly sell off stocks into a rising market. When the crash
    comes buy back in at a much lower price and wait it out. And
    always remember, you're not responsible for the entire world
    around you. All you can do is take advantage of opportunities
    and lie. Did I mention lie?
  • RE: Schmidt: Worst of recession is over; Google is hiring

    There is one thing you guys must understand:
    until you abolish the Federal Reserve bank and restore the right of the Treasury to print money, free of debt, you will have this vicious circle of recessions, "recoveries", stimulus packages, etc.
    Of course, I know that you are not not sick of the system, yet. You are not angry enough. But you have to get mad. You must say: I am human being, God damn it, my life has value!!!

    If you truly want to solve a problem you have to strike at its source ... and the source is the banking system.

    Socialism for the rich, free enterprise for the poor. Until America wakes up for the social ills that persisted for generations, things will be spiraling out of control over, and over, and over again.
    • The Fed

      The Federal Reserve was created to deal with problems with the economy. The 1900's had a lot of bank runs that led to panics and instability. The Fed was created to counter bank runs and prevent panics; how successful it has been is debatable. I think it has done both good and bad for the economy.
  • RE: Schmidt: Worst of recession is over; Google is hiring

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