During the recent quarter of the past year, the Internet advertising growth slowed down, so as the revenue of Google Incorporated, falling flat of Wall Street’s current expectations, while compensating a slight improvement in advertising pricing, which caused its shares to go down by 3%.
During the third quarter, the overall number of paid clicks or ads expanded by almost 17%, which was lower than the 25% growth rate that the company delivered during the second quarter.
Overall online advertising rates on the other hand, which was stuck in a recent multi-year drop, moderated slightly during the year’s third quarter, dropping 2% year-every-year. That was an indication of improvement compared to the 6% decrease in its Cost-Per-Click (CPC) during the second quarter.
On Thursday, Google Incorporated’s shares fell by 2.7% in extended trading amounting to $510.11.
Colin Gillis, an analyst of BGC Partners said the CPC decline has already stopped, and that was a big advantage. Gillis also reiterated that if CPCs tend to flat line will help significantly the company’s core.
The posted overall revenue of Google was $16.52 billion for three months, which ended on September 30. Google’s last year’s revenue was at $13.75 billion. Thomson Reuters I/B/E/S conducted a poll among analysts, indicating their revenue estimate of $16.57 for the recent quarter.
Google also significantly increased its spending this quarter as the company has increased employee headcount by 3,000. The total headcount contributed a 46% increase in the company’s research and development spending.
Google announced on Thursday its newly appointed Chief Business Officer (CBO), Omid Kordestani to replace Nikesh Arora. Arora left Google a quarter ago and joined the Softbank Corporation of Japan. The CBO is a significant position to administer all Google’s revenue-generating activities, while acting as a liaison officer to Wall Street and investors at the same time.