Originally posted on VentureBeat:
Last week Google stock crashed 10%, shedding about $21 billion in market value, when its earnings were prematurely released. Google revenue was up … but profit was down.
Now a new report from an independent source, internet marketing software company Wordstream, is giving us more information on how, exactly, that happened.
Essentially, even though total revenue rose to hit $14.1 billion, including $10.8 billion in advertising revenue, the amount advertisers pay for each click decreased significantly. Advertisers paid 16.5 percent less per click on Google search results compared to the previous quarter, and a whopping 18.2 percent less on Google’s display network (sites around the Internet that carry Google’s ads).