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Google disappoints with consolidated $18.10 billion

Staff writer |
Google Inc. announced financial results for the quarter and fiscal year ended December 31, 2014. Consolidated revenues were $18.10 billion for the quarter ended December 31, 2014, an increase of 15% compared to the fourth quarter of 2013.

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Google Inc. reports advertising revenues, consistent with GAAP, on a gross basis without deducting traffic acquisition costs (TAC). In the fourth quarter of 2014, TAC totaled $3.62 billion, or 22% of advertising revenues.

Analysts had been modeling $14.74 billion in net revenue and $18.44 billion in gross revenue, and $7.12 per share.

GAAP operating income in the fourth quarter of 2014 was $4.40 billion, or 24% of revenues. This compares to GAAP operating income of $4.43 billion, or 28% of revenues, in the fourth quarter of 2013.

Non-GAAP operating income in the fourth quarter of 2014 was $5.60 billion, or 31% of revenues. This compares to non-GAAP operating income of $5.30 billion, or 34% of revenues, in the fourth quarter of 2013.

GAAP net income (including net income (loss) from discontinued operations) in the fourth quarter of 2014 was $4.76 billion, compared to $3.38 billion in the fourth quarter of 2013. Non-GAAP net income in the fourth quarter of 2014 was $4.74 billion, compared to $4.57 billion in the fourth quarter of 2013.

GAAP EPS (including impact from net income (loss) from discontinued operations) in the fourth quarter of 2014 was $6.91 on 688 million diluted shares outstanding, compared to $4.95 in the fourth quarter of 2013 on 682 million diluted shares outstanding. Non-GAAP EPS in the fourth quarter of 2014 was $6.88, compared to $6.70 in the fourth quarter of 2013.

Non-GAAP operating income and non-GAAP operating margin exclude stock-based compensation (SBC) expense from continuing operations. Non-GAAP net income and non-GAAP EPS exclude SBC expense from continuing operations, net of the related tax benefits, as well as net income (loss) from discontinued operations.

In the fourth quarter of 2014, the expense related to SBC from continuing operations and the related tax benefits were $1,201 million and $255 million compared to $873 million and $184 million in the fourth quarter of 2013. In addition, net income from discontinued operations in the fourth quarter of 2014 was $967 million, compared to a net loss of $506 million in the fourth quarter of 2013.


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