Google 2013 Annual Report Download - page 30
Download and view the complete annual report
Please find page 30 of the 2013 Google annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.24 GOOGLE INC.
PART II
ITEM7.Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations
Management’s Discussion and Analysis of Financial
Condition and Results ofOperations
Thefollowingdiscussionandanalysisofournancialconditionandresultsofoperationsshouldbereadtogetherwithour
consolidatednancialstatementsandrelatednotesincludedunderItem8ofthisAnnualReportonForm10-K.
Overview
Googleisaglobaltechnologyleaderfocusedonimprovingthewayspeopleconnectwithinformation.Weaspiretobuildproducts
andprovideservicesthatimprovethelivesofbillionsofpeopleglobally.Ourmissionistoorganizetheworld’sinformationand
makeituniversallyaccessibleanduseful.Ourinnovationsinwebsearchandadvertisinghavemadeourwebsiteatopinternet
propertyandourbrandoneofthemostrecognizedintheworld.OurGooglesegmentgeneratesrevenuesprimarilybydelivering
relevant,cost-eectiveonlineadvertising.BusinessesuseourAdWordsprogramandAdSenseprogramtopromotetheirproducts
andserviceswithadvertisingonbothGoogle-ownedpropertiesandpublishers’sitesacrosstheweb.
Our Motorola Mobile segment is focused on mobile wireless devices and related products and services and generates revenues
primarilybysellinghardwareproducts.InJanuary2014,weenteredintoanagreementwithLenovoprovidingforthedisposition
oftheMotorolaMobilesegment.Thetransactionisexpectedtoclosein2014.
TheMotorolaHomesegmentwasfocusedontechnologiesanddevicesthatprovidevideoentertainmentservicestoconsumersby
enablingsubscriberstoaccessavarietyofinteractivedigitaltelevisionservices.InDecember2012,weenteredintoanagreement
forthedispositionoftheMotorolaHomesegment.ThetransactionclosedonApril17,2013.AllnancialresultsrelatedtoMotorola
Homewerepresentedasnetincome(loss)fromdiscontinuedoperationsontheConsolidatedStatementsofIncome.
Trends in Our Businesses
Advertisingtransactionscontinuetoshiftfromoinetoonlineasthedigitaleconomyevolves.Thishascontributedtothe
rapid growth of our business since inception, resulting in substantially increased revenues, and we expect that our business
willcontinuetogrow.However,ourrevenuegrowthratehasgenerallydeclinedovertime,anditcoulddosointhefutureasa
result of a number of factors, including increasing competition, our investments in new business strategies, products, services,
and technologies, changes in our product mix, shifts in the geographic mix of our revenues, query growth rates and how users
make queries, challenges in maintaining our growth rate as our revenues increase to higher levels, and the evolution of the online
advertisingmarket,includingtheincreasingvarietyofonlineplatformsforadvertising,andothermarketsinwhichweparticipate.
Our users are increasingly connected to the internet and using multiple devices to access our products and services, a trend that
hasincreasedourglobalsearchqueriesandchangedourplatformmix.Weexpectthatourrevenuegrowthratewillcontinue
tobeaectedbyevolvingconsumerpreferences,aswellasbyadvertisingtrends,theacceptancebyusersofourproductsand
services as they are delivered on diverse devices, and our ability to create a seamless experience for both users and advertisers
inthismulti-screenenvironment.
The main focus of our advertising programs is to help businesses reach people in the moments that matter across all devices
withsmarteradsthatarerelevanttotheirintentandcontext,reectingourcommitmenttoconstantlyimprovetheiroverallweb
experience.Asaresult,weexpecttocontinuetotakestepstoimprovetherelevanceoftheadsdisplayedonourwebsitesand
ourGoogleNetworkMembers’websites.Thesestepsincludenotdisplayingadsthatgeneratelowclick-throughratesorthat
senduserstoirrelevantorotherwiselow-qualitywebsites,updatingouradvertisingpoliciesandensuringtheircompliance,and
terminatingourrelationshipswiththoseGoogleNetworkMemberswhosewebsitesdonotmeetourqualityrequirements.We
mayalsocontinuetotakestepstoreducethenumberofaccidentalclicksbyourusers.Thesestepscouldnegativelyaectthe
growthrateofourrevenues.
Bothseasonaluctuationsininternetusageandtraditionalretailseasonalityhaveaected,andarelikelytocontinuetoaect,
ourbusiness.Internetusagegenerallyslowsduringthesummermonths,andcommercialqueriestypicallyincreasesignicantlyin
thefourthquarterofeachyear.Theseseasonaltrendshavecaused,andwilllikelycontinuetocause,uctuationsinourquarterly
results,includinguctuationsinsequentialrevenues,aswellasaggregatepaidclicksandaveragecost-per-clickgrowthrates.
contents