Google Incorporated’s slowing advertising business is also masking the growth of little-noticed but significant businesses like software, digital music, and mobile device sales.
Google reported last Thursday about its weakening growth when it comes to ad volumes during the third quarter. Google’s current situation causing Wall Street worries about the company’s efforts in adapting the mobile landscape.
But a bright spot that many investors and analysts are saying that soon, a bigger and better growth engine will benefit future quarters when it comes to sales of apps, digital music, and even hardware.
The Play store of Google, a site that sells apps, music, movies, and also games, have been just one of the company’s several businesses that are not based on its long standing advertising activities which are basically part of the company’s unimaginatively named but still fast-growing segment.
That said segment is 11% of Google’s overall revenue during the third quarter that grew to 50% to about $1.84 billion.
Colin Gillis an analyst of BGC Partners of the said revenue segment stated that if he were to examine the four critical and important metrics, this would definitely be one and it’s another significant monetization of the company’s mobile platform.
With Google’s shift from only concentrating on PCs to smartphones today, it had pressured high prices for the company’s ads, and it also has spurred attractive business opportunities for the company.
Kerry Rice an analyst from Needham & Co stated that overall revenues from different businesses increased in other categories that can easily double in the coming years.
To be on the safe side, Google is still considering this category to be somewhat like a black box. The company didn’t disclose if the said segment is really profitable and also provided limited details on its big growth last Thursday. Details about the growth of unspecified licensing revenues and the Play store were shared.