Google announced their Q3 earnings last Thursday (October 17th) with higher-than-expected earnings, up 12% over the previous year at $14.89 billion. This resulted in Google shares crossing the $1000 per share mark for the first time in the companies’ history. Before we get into how that’s being accomplished, let me first insert my brief rant:
THERE IS NO REASON GOOGLE SHOULD BE VALUED AT WHAT IT IS !! IT’S LIKE WE’VE FORGOTTEN THE DOT COM BUBBLE BURSTING WITH THE CRAZY VALUATIONS WE GIVE TECH COMPANIES !!!
Alright, feeling better …
At the end of the day the higher than expected earnings came on the back of an average 8% drop in the average cost per click. This drop was due mainly to the growth in mobile however (where the rates are cheaper) and rather than indicating a decline in search is an indicator to the contrary. Because growth in the mobile realm is as high as it is, it is able to impact the overall averages dramatically however desktop search did not decline. This is a case of Google winning in mobile and not losing in desktop creating a net gain though an average cost per click drop.
If we don’t think this growth in mobile wasn’t the key to the Hummingbird changes we’d be kidding ourselves. Hummingbird has very little to do with desktop search and everything to do with mobile and mobile devices. With the growth in the sector being what it is and the enormous revenue opportunities that exist there – it looks as though Google is adjusting their entire algorithm to accommodate. And it makes sense as users demand more from mobile and from technology in general. The contest is on to feed more data faster and monetize better. Tell us what we want before we know we want it.
Will Google be able to keep up? Only time will tell. It’s theirs to lose at this point but not that long ago it was Microsoft’s to lose. Of course, Microsoft could buy Google if they wanted so …
And now, on a lighter note (albeit it only slightly relevant) let’s take a moment to remember what we have, what mobile is doing, what we take for granted and maybe even chuckle a bit …
SEO news blog post by Dave Davies, CEO @ 11:10 pm