Google surges in Britain as online ad sales boom
Friday 18 July 2014
Revenues at Google’s British operation surged 22 per cent to $1.62bn (£948m) in the three months to June, in a positive sign for the wider UK economy.
Even leaving aside ster-ling’s strength, UK revenues rose 15 per cent on an un- derlying basis.
The chief financial officer, Patrick Pichette, said that the company was “pretty pleased with the momentum” in Britain, its biggest market outside America.
Google’s UK performance echoes the quarterly “Bellwether” survey from the Institute of Practitioners in Advertising, which found that British marketers increased ad budgets for the seventh successive quarter. It is the longest period of continuous growth in the survey’s 14-year history amid signs the UK economy is growing strongly. Internet marketing grew at its fastest rate for a year, according to the institute.
Google, Britain’s biggest media company by ad revenues, has seen its UK turnover double in four years, although it processes most of its sales in Ireland to avoid British corporation tax.
Worldwide revenues rose 22 per cent to $15.96bn in the last quarter but profits rose only slightly to $3.42bn, against $3.23bn a year earli- er, as it hired an extra 2200 staff. The average cost-per-click, the amount an advertiser pays when a user clicks on an ad, fell 6 per cent.
Mr Pichette said Google is continuing to invest in its own super-fast fibre broadband network in the US as it seeks to “build the demand” for people to use more online services. The company is in talks with 34 cities in America.
Reports have suggested it is also looking at owning a fibre network in the UK, which could be a threat to BT and Virgin Media.
Nikesh Arora, Google’s chief business officer and a former UK boss, is quitting for Japan’s Softbank.
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