Microsoft misses analyst expectations, while Google’s CPC falls

Google’s revenue rose during the last quarter despite cheaper online ad prices, while Microsoft’s were also boosted despite despite a lukewarm reception to Windows 8.


Microsoft’s revenues rose 18 per cent annually to $20.5bn (13.4bn) during the last quarter, while Google posted revenues of $14bn (£9.1) during the same period as it transitions to monetising mobile clicks.

Microsoft CEO Steve Ballmer ( pictured above) said the results proved the company’s “bold bets are paying off” adding services such as Office 365 and its Xbox LIVE continue to grow.

The company’s earnings however just missed expectations while it also announced the exit of its CFO Peter Klein. A replacement has yet to be named.

The company’s Windows Division posted revenue of $5.70bn (£3.7bn), a 23 per cent annual increase. This is despite sales of its Windows 8 and Surface tablet devices failing to generate huge sales in the immediate aftermath of their launch.

Meanwhile, its online services division, which incorporates services such as Microsoft Advertising and Bing, generated revenues of $832m (£542m) for the quarter, an 18 per cent increase year on year.

Klein adds: “Looking ahead, we will continue to invest in long-term growth opportunities to drive our devices and services strategy forward and deliver ongoing value to shareholders.”

Separately, Google’s revenues rose 31 per cent year on year in the three months to March 31, with the total number of paid clicks increasing 20 per cent year on year.

Although this was offset by its average cost per click (CPC) decreasing 4 per cent both annually and from the previous quarter.

The earnings report was Google’s first since it announced a fundamental overhaul to its AdWords platform in February.

This update was introduced to accommodate the emergence of people searching on smartphones, which have historically generated lower CPCs than on desktop.

In the company’s earnings call, Larry Page, Google CEO, said: “I’ve been very pleased with the rate of progress so far. We are smoothly moving a huge advertising system and ecosystem on a dime.”

On the same earnings call, Google’s chief business officer Nikesh Arora reported that 95 per cent of Google’s advertisers have launched campaigns on multiple screens.

“In the first two months since its launch more than 1.5 million campaigns have already been upgraded to ads campaigns. And these clients are beginning to seek great results,” he added.

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