Lately, Google is doing better financially than Wall Street was expecting. Revenue is up and so are profits.
The first earning report was just released by Google's new CFO, Ruth Porat. Google's profits are attributed in part to her effort to keep costs under control.
"The slower growth in costs, along with suggestions from Ms. Porat that Google will try to be more forthcoming with investors - and may be open to redistributing some of the company's cash pile down the line - suggested a new era of cooperation from a company that has historically had an antagonistic relationship with Wall Street," writes Conor Dougherty in The New York Times.
According to The New York Times, Google reported that revenue rose 11 percent to $17.7 billion from a year ago, with net revenue increasing to $14.35 billion.
Google spends a lot of money on ideas that might not pay off for a long time, if ever. These projects range from self-driving cars to high-tech threads that can be woven into computer clothes. The company claims that these projects are a sign that they are doing well and can afford long-term R&D.
"Google spent $2.8 billion, or 16 percent of its revenue, on research and development, compared with 14 percent a year ago," writes Dougherty.
Porat says that "cost per click" for online advertising, which has fallen recently due in part to the increased us of mobile phones, is on the rise. She expects that desktop prices will remain steady, but mobile prices will grow.
"Analysts are starving for specifics about what exactly is driving this and what it means about Google's core search business and growing areas like YouTube," writes Dougherty. "During the call, one analyst asked if more specific disclosures would be coming in the months and years ahead. Ms. Porat did not make any commitments, but said: 'I am trying to create a framework that helps you understand where we're going.'"
Not bad for a company that was originally called BackRub. Here's an inforgraphic about the history of Google by the folks at Infographic Labs.