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Thursday, July 21, 2005

Google’s Profits Jump

Posted by Richard Zwicky @ 3:03 pm

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On Tuesday, Yahoo Inc, posted an increase in Q2 profits, but its shares dropped 10% as investors were disappointed with overall revenue growth. Their revenues in the period were $1.254 billion, with a net income of $261 million. This represents 20.8% of revenues.

Today, Google Inc. announced their Q2 results. Their revenues were $1.384 billion, and their net income was $343 million. Their income represents 24.8% of revenues.

Both companies are doing incredibly well. Their combined growth points to a very health search advertising marketplace. It also bodes well for search engine optimization and search engine marketing firms.

For marketing firms, the allure is obvious - more and more firms require specialists to manage their campaigns and increase ROI.

For web site optimization specialists, like ourselves, the increased ad spending is indicative on a continued growth in awareness of Internet Marketing. It is also being reflected by increased interest in organic SEO as a online strategy. While SEO does not have the short term immediacy of results that a PPC campaign does, it has longer term ROI - more traffic is generated from organic listings than PPC, and a broader range of terms are naturally captured at a lower cost than PPC. Also, organic search benefits continue beyond the end of the campaign.

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