Google sales rise despite Motorola slip

The company also had mixed results in its ads business

Google's revenue and net income for the past five financial quarters

Google's revenue and net income for the past five financial quarters

Google reported a healthy 17 percent increase in revenue for the fourth quarter, even as sales by its Motorola mobile unit, which the company is selling to Lenovo, dropped again from the same period last year.

Revenue for the quarter ended Dec. 31, was US$16.86 billion, topping analysts' projections of $16.75 billion, as polled by Thomson Reuters, Google reported Thursday. Taking into account commissions, fees and traffic acquisition costs the company pays to other sites that run its ads, which were excluded from that figure, Google's sales were $13.55 billion for the quarter, the company reported.

Net income was $3.38 billion, up almost 17 percent from the same period in 2012. Earnings per share was $9.90, nearly a 15 percent increase. Excluding certain expenses, Google's earnings per share, however, was $12.01, coming in under analyst estimates of $12.26.

"We ended 2013 with another great quarter of momentum and growth," CEO Larry Page said in the company's announcement, citing progress across "a wide range of product improvements and business goals."

But Google had mixed results in its advertising business, from which it derives practically all of its revenue. The cost of paid clicks, or the money Google charges when someone clicks on an ad, which is a key advertising metric, decreased by about 11 percent compared to the fourth quarter of 2012.

Meanwhile, paid clicks, or the clicks on search ads paid for by advertisers, rose by about 31 percent, Google reported.

Google made big news on Wednesday when it announced that it would be selling Motorola Mobility to the Chinese company Lenovo for $2.91 billion, less than two years after Google paid more than $12 billion to acquire the cell phone maker.

Sales for that unit, at $1.24 billion, decreased by more than 17 percent compared to the fourth quarter of 2012, Google reported Thursday.

Google also reported a 33 percent sales drop for Motorola in the company's third-quarter results.

With the Motorola sale, Google will be holding on to some key patents as well as a smaller division of Motorola focused on cutting-edge projects. The Internet company could be asked more about those areas when executives take questions from investors and financial analysts during an earnings call later on Thursday.

Google may also comment more on the health of its critical Android mobile OS, which now runs on more than 80 percent of all smartphones, according to recent research from the IDC.

In its fourth-quarter earnings, the company also reported that its Google-owned sites generated revenue of $10.55 billion, up 22 percent from the pervious year. Partner sites generated sales of $3.52 billion, up 3 percent.

Google stock was trading at $1,135.39 in after-market hours, up from its closing price of $1,106.92 Wednesday.

Zach Miners covers social networking, search and general technology news for IDG News Service. Follow Zach on Twitter at @zachminers. Zach's e-mail address is zach_miners@idg.com

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Tags business issuesInternet-based applications and servicesGooglefinancial resultsMotorola Mobilitysocial networkingLenovosocial mediainternetsearch engines

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Zach Miners

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