But the bottom line is the other half of the story, and that's the part that worries investors.
Google is expected to have booked net revenue of $5.25 billion in the September quarter, excluding the estimated $1.8 billion in so-called traffic acquisition costs (TAC) that the company pays its affiliates to funnel people onto its network. The whispers of wind filling Google's sails comes from its continued growth overseas and the market share it is winning from No. 2 rival Yahoo! (YHOO).
But investors are leery of Google's wide-ranging expansion efforts and the impact of the rising costs on margins.Analysts expect Google's third quarter adjusted profits to be $6.67 a share, according to Yahoo! Finance. But Google has shown recent signs that it is starting to jettison unprofitable or distracting ventures on its books. Google is unplugging its free phone directory service 1-800-GOOG-411 and it is winding down its Google Groups topic discussion service next month. This may not mean Google layoffs, but it does suggest that there's some new discipline at the big free-spending shop. Analysts and investors will be tuning in to hear Google's assessment of its Android effort, which has started to outshine rival Apple's (AAPL) iPhone. The push of ads into YouTube videos is also an area of interest as a potential new revenue stream. Google shares have enjoyed a modest 10% rise in the past two months but remain down 13% for the year. The stock could certainly make up that lost ground with a solid two-part sales growth and profit story. --Written by Scott Moritz in New York.
>To contact this writer, click here: Scott Moritz, or email: firstname.lastname@example.org. To follow Scott on Twitter, go to http://twitter.com/TheStreet_Tech. >To send a tip, email: email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV