Company on biggest spending spree since 2008
Though Google registered a 29% jump in net revenue in the first quarter earnings, its shares dropped more than 5% as investors seemed to focus on the rise in expenses to $2.84bn.
Google posted net income of $2.3bn, or $7.04 a share, up from $1.96bn, or $6.06 a share, in the previous year’s first quarter. It earned $8.08 a share.
The search engine company said the factors that contributed to its topline growth included an 18% jump in the paid clicks on its search ads, innovation in retail ads, and the revenue from mobile ads and video ads on its YouTube website.
CEO Larry Page told investors that there is tremendous improvement to be had in their core products and core business.
Page said, "I’m very excited about Google and our momentum, and I’m very, very optimistic about our future."
Google chief financial officer Patrick Pichette said, "The investors we have actually understand that we are building businesses for the long term."
"They also want growth, which we delivered this quarter."
In the 1Q earnings report, the company declared a record hiring spree, across the board salary raises of 10%, and spending in marketing and technology. Google executives said the rise in spending was part of the company’s strategy to invest in bigger business opportunities.
The company said it hired over 1,900 people, and plans to hire over 6,200 workers this year, the highest in its 13-year history. The number of workers the company had by March was over 26,300 workers, 28% higher than a year ago.