Media

Google making $1 billion a year from mobile

Google executives tried to fend off concerns this afternoon that they’re still making all their money from cheap text ads running alongside the company’s search results and on its AdSense network. So during the conference call discussing third quarter earnings, they presented some numbers about Google’s “emerging” businesses. Chief financial officer Patrick Pichette emphasized that executives are only sharing these numbers once, to make a point about Google’s revenue sources.

Here’s the data they shared:

  • Google’s non-text display advertising has an “annualized run rate” of $2.5 billion, meaning that based on numbers from the last three months, the company is on-track to earn earn $2.5 billion per year. (Google has been placing a greater emphasis on display advertising this year.)
  • On YouTube, Google is “monetizing” 2 billion views per week. The company says YouTube gets a total of 2 billion views per day, so it sounds like it’s running ads on about one-seventh of all views. But executives declined to say whether YouTube is actually profitable.
  • Google is on-track to make $1 billion in revenue from mobile this year. One of the analysts on the earnings conference call wondered whether Google’s ad revenue is threatened by the increasing prevalence of applications on smartphones. (Apple’s Steve Jobs has said that the growth of apps on the iPhone means that the existing search advertising model doesn’t make sense.) Chief executive Eric Schmidt said that assumes the mobile market is a “zero sum game.” Instead, revenue growth suggests that “a rising tide lifts all boats.”

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  1. […] and tablets. Revenues generated from those mobile ads alone make up a significant portion of the $1 billion Google makes from their entire mobile ads business per […]