Now let me now quickly cover the Safe Harbor. Some of the statements we make today may be considered forward-looking, including statements regarding Google’s future and investments in our long term growth and innovation, the expected performance of our business and our expected level of capital expenditures. These statements involve a number of risks and uncertainties that could cause actual results to differ materially. Please not that these forward-looking statement reflect our opinions only as of the date of this presentation and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events.Please refer to our SEC filings for a more detailed description of the risk factors that may affect our results. Also, please note that certain financial measures we use on this call such as operating profit and operating margin are expressed on a non-GAAP basis and have been adjusted to exclude charges relating to stock-based compensation. We have also adjusted our net cash provided by operating activities to remove capital expenditures, which we refer to as free cash flow. Our GAAP results and GAAP to non-GAAP reconciliation can be found in our earnings press release. With that, I will now turn the call over to Patrick. Patrick Pichette Thank you, Jane. Good afternoon, everyone, and thank you for joining us. As Jane mentioned, Jonathan and I will begin with the prepared remarks, but we also have Nikesh with us for the Q&A. So, let me start you by giving some high-level thoughts about the quarter and then we will get into our detailed financial performance. So, overall we are very pleased with our Q2 results. We experienced continued solid growth in our core, but also very strong growth in our emerging businesses year-over-year. Taking a step back actually, these results reflect a few really important trends in the digital advertising. First, we are really taking notice that more and more traditional brand advertisers are embracing search and search advertising is a way to build their brands online. A case in point P&G, it’s one of the largest brand advertisers in the world. And it’s now one of our top advertisers in the U.S.
Second, we see also a real trend in large advertising, focusing on highly measurable but also integrated campaigns across display, mobile and search. So, as a result, we saw strength in every major product in Q3. Google.com was strong with strong performance across major geographies and most major verticals, including CPG, retail, travel, et cetera.Our growth in display was also very strong. Our continued focus in this product area is clearly generating results. Our display network, which includes YouTube, is growing very rapidly. The scale and quality of our network continues to increase and we see increased demand from traditional brand advertisers in that space as well. In addition, we made yet another significant stride in display this week, when we entered into a strategic agreement with Omnicom Media Group. We will be working together with Omnicom to co-develop their exchange trading desk for the double click ad exchange in the coming years. YouTube specifically we continue to see very impressive growth as brand advertisers also consider it a must-buy. For example, and as I mentioned a moment ago, in Q2 we ran World Cup advertising campaigns for major advertisers of the likes of Coke, Visa, Nike, Sony, et cetera. Finally, on YouTube, I think it’s really worth noting that we are very pleased of course with the court’s decision to rule in our favor in the Viacom case. But more important in this victory, it’s not for us, but for the users and just the Web in general. Specifically for all the blogs and the community forms across the Web that do rely on this user-generated content for sharing information and also for free expression. Look, we were very passionate about this issue at Google and so much so that we have made significant investment of approximately $100 million to win this case. And once again, it just was the right thing to do and we did it.
In mobile, our revenue continues to grow as advertiser increasingly opt into their mobile-specific campaigns, and with the successful completion of the AdMob transaction in Q2, our business is gaining momentum. And so we have a very competitive mobile advertising platform now. And of course, underpinning our growth is the success of the Android platform itself with over, as we announced a couple of weeks ago, 160,000 devices activated daily. That’s two every second. And it creates an even larger base of data-centric smart phone users.Finally, enterprise had another good quarter with several high-profile deals, including, for example, Virgin America. The world is simply moving into the cloud. And successful products do require investment. And that’s why we are focusing our resources on products that, as you all know, leverage computer science to solve our big problems, offer great ROIs, and very large growth opportunities. For example, in Q2 we’ve added approximately 1200 employees. That’s obviously counting the acquisitions of AdMobs and the others. But the majority is done in engineering and sales and in the following product areas: search monetization, display, mobile, apps, all the next billion dollar businesses that are growing incredibly rapidly. And that’s why we are investing in them. Jonathan will give you more details about that in a moment. So, now let me turn to our financial results. Gross revenue. Gross revenue grew 24% year-over-year to $6.8 billion. Our Google website’s revenue was also up 23% year-over-year to $4.5 billion, with strength, as I mentioned, across most geographies and verticals. Our AdSense revenue was up 23% as well to $2.1 billion, reflecting our continued strength specifically in the Google display network. Read the rest of this transcript for free on seekingalpha.com