Microsoft today announced the final updates to the fall release of its Live Search service, introducing a broad array of new services and features to its local and mobile search offerings. The new features and enhancements are designed to make it easier for people to find what they need at home or on the go through significant innovations in mapping, imagery and driving directions as well as new services to make the mobile search experience easy and powerful.
Microsoft also announced the availability of the Live Search 411 service. Customers can gain toll-free* access by dialing (800) CALL-411 (800-225-5411) from any phone to find and connect to local businesses and other local information, such as weather updates, movie show times and airline information. People using a cell phone with Internet access can also receive links to traffic maps from Live Search 411.
“Microsoft is building on several years of innovation in imagery and 3-D visualization, adding some of the most significant innovations to driving directions technology in the last several years and expanding how our current 185 million customers can experience the improvements to the core of Live Search to include access from a wider variety of clients, platforms and devices,†said Satya Nadella, corporate vice president of the Search & Advertising Platform Group at Microsoft. “Collectively, these improvements build on the work we did in core relevance and differentiated vertical experiences, and are an important milestone in our efforts in delivering a comprehensive, innovative search offering that includes mobile, mapping, Web and local services for customers to find what they need, when they need it, on any device.â€
Today’s announcement comes on the heels of the release on Sept. 26 of several new capabilities for Live Search, which included significant improvements in relevance and coverage in the core Web search service and expanded the range and depth of information available in areas where most customers were doing most of their queries — entertainment, shopping, health and local searches.
Today’s release offers these key features:
Maps and Directions
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Innovative driving directions. The new Live Search offers more accurate and easy-to-use driving directions, including dynamic rerouting of directions based on real-time traffic information, one-click directions that allow drivers to get only essential directions to their destination with no starting point needed, and inline hints that tell drivers if they have gone too far based on local landmarks. Combined with new, one-page printing, these new enhancements have taken driving directions to the next level. |
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Innovative visualization and 3-D. Coverage of bird’s-eye and 3-D imagery has been increased to cover 80 percent of the U.S. population. In addition, nearly 200 complete cities are available in 3-D, and customers can now combine views of 3-D imagery with Live Search’s unique 45-degree bird’s-eye images, giving a complete and detailed geolocation experience. In addition, people who use Live Search Maps can create and share their own 3-D models of buildings through an alliance with Dassault Systemes. |
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Innovative local content index including user-generated content.The new local search capabilities in Live Search include not only a broad set of expert sources but also broad access to user-generated content from Live Search and from across the entire Web, through searchable user-created collections and Keyhole Markup Language (KML) support. |
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Virtual Earth platform updates. The Virtual Earthâ„¢ platform is the underlying technology behind well over 1,000 partner mapping solutions as well as Live Search Maps. Updates in version 6.0 of Virtual Earth include multipoint trip routing; enhanced geocoding that combines results for multiple geocoders; rooftop geocoding, which provides more precise geocoding results; map control support for Safari 2.0; and the release of MapCruncher beta, making it easier to publish maps overlaid in an application using the Virtual Earth map control. More details on the Virtual Earth platform can be found at http://dev.live.com/virtualearth. |
Mobile Enhancements
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Live Search for Windows Mobile with voice input. The updated Live Search for Windows Mobile® 5.0 and 6.0 will be available for download for free on Tuesday, Oct. 16, and now includes voice input (beta version), gas prices, and hours of operation for businesses. The service can also use Global Positioning System (GPS) data on GPS-enabled phones to provide location-aware local search for customers. |
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Live Search 411. Jointly developed with Tellme Networks Inc., acquired by Microsoft earlier this year, a new toll-free number will be available for anyone using any kind of phone to access the power of Live Search. Users can simply dial (800) CALL-411 (800-225-5411) and say the city and state, then ask for the business or business category to hear a list of options. Users say, “Connect me,†to instantly connect to the business. Cell phone users can ask for a text message with a link to a map of the business.* |
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Live Search for use with BlackBerry® Devices. Live Search designed for use with BlackBerry devices is in beta and will be available for download for free on Tuesday, Oct. 16. It is a new offering designed for use on BlackBerry OS 4.0.2 or later phones, and customers with GPS-enabled phones can use location awareness to enhance their searches. |
More information on the mobile offerings will be available at http://www.LiveSearchMobile.com and http://www.LiveSearch411.com.
October 19th, 2007
Google today announced financial results for the quarter ended September 30, 2007.
“We are very pleased with the impressive growth we experienced across our business,” said Eric Schmidt, CEO of Google. “Our core search advertising business experienced continued momentum driven by growth in monetization and traffic, and we are creating a wider and deeper ads system through our focus on innovation, bringing more ad formats to our advertisers. Our efforts to offer more products and services in international markets as well as effectively grow our technology infrastructure and add to our deep talent base during the quarter helped to deliver growth by enabling Google to reach more users around the world.”
Q3 Financial Summary
Google reported revenues of $4.23 billion for the quarter ended September 30, 2007, an increase of 57% compared to the third quarter of 2006 and an increase of 9% compared to the second quarter of 2007. Google reports its revenues, consistent with GAAP, on a gross basis without deducting traffic acquisition costs, or TAC. In the third quarter of 2007, TAC totaled $1.22 billion, or 29% of advertising revenues.
Google reports operating income, net income, and earnings per share (EPS) on a GAAP and non-GAAP basis. The non-GAAP measures, as well as free cash flow, an alternative non-GAAP measure of liquidity, are described below and are reconciled to the corresponding GAAP measures in the accompanying financial tables.
- GAAP operating income for the third quarter of 2007 was $1.32 billion, or 31% of revenues. This compares to GAAP operating income of $1.10 billion, or 29% of revenues, in the second quarter of 2007. Non-GAAP operating income in the third quarter of 2007 was $1.52 billion, or 36% of revenues. This compares to non-GAAP operating income of $1.35 billion, or 35% of revenues, in the second quarter of 2007.
- GAAP net income for the third quarter of 2007 was $1.07 billion as compared to $925 million in the second quarter of 2007. Non-GAAP net income in the third quarter of 2007 was $1.24 billion, compared to $1.12 billion in the second quarter of 2007.
- GAAP EPS for the third quarter of 2007 was $3.38 on 317 million diluted shares outstanding, compared to $2.93 for the second quarter of 2007 on 315 million diluted shares outstanding. Non-GAAP EPS in the third quarter of 2007 was $3.91, compared to $3.56 in the second quarter of 2007.
- Non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, and non-GAAP EPS are computed net of stock-based compensation (SBC). In the third quarter of 2007, the charge related to SBC was $198 million as compared to $242 million in the second quarter of 2007. Tax benefits related to SBC have also been excluded from these non-GAAP measures. The tax benefit related to SBC was $31 million in the third quarter of 2007 and $43 million in the second quarter of 2007. Reconciliations of non-GAAP measures to GAAP operating income, operating margin, net income, and EPS are included at the end of this release.
Q3 Financial Highlights
Revenues - Google reported revenues of $4.23 billion for the quarter ended September 30, 2007, representing a 57% increase over third quarter 2006 revenues of $2.69 billion and a 9% increase over second quarter 2007 revenues of $3.87 billion. Google reports its revenues, consistent with GAAP, on a gross basis without deducting TAC.
Google Sites Revenues - Google-owned sites generated revenues of $2.73 billion, or 65% of total revenues, in the third quarter of 2007. This represents a 68% increase over third quarter 2006 revenues of $1.63 billion and a 10% increase over second quarter 2007 revenues of $2.49 billion.
Google Network Revenues - Google’s partner sites generated revenues, through AdSense programs, of $1.45 billion, or 34% of total revenues, in the third quarter of 2007. This represents a 40% increase over network revenues of $1.04 billion generated in the third quarter of 2006 and an 8% increase over second quarter 2007 revenues of $1.35 billion.
International Revenues - Revenues from outside of the United States totaled $2.03 billion, representing 48% of total revenues in the third quarter of 2007, compared to 44% in the third quarter of 2006 and 48% in the second quarter of 2007. Had foreign exchange rates remained constant from the second quarter of 2007 through the third quarter of 2007, our revenues in the third quarter of 2007 would have been $24 million lower. Had foreign exchange rates remained constant from the third quarter of 2006 through the third quarter of 2007, our revenues in the third quarter of 2007 would have been $121 million lower.
Revenues from the United Kingdom totaled $661 million, representing 16% of revenue in the third quarter of 2007, compared to 16% in the third quarter of 2006 and 15% in the second quarter of 2007.
Paid Clicks - Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of our AdSense partners, increased approximately 45% over the third quarter of 2006 and approximately 5% over the second quarter of 2007.
TAC - Traffic Acquisition Costs, the portion of revenues shared with Google’s partners, increased to $1.22 billion in the third quarter of 2007. This compares to TAC of $1.15 billion in the second quarter of 2007. TAC as a percentage of advertising revenues was 29% in the third quarter, compared to 30% in the second quarter of 2007.The majority of TAC expense is related to amounts ultimately paid to our AdSense partners, which totaled $1.12 billion in the third quarter of 2007. TAC is also related to amounts ultimately paid to certain distribution partners and others who direct traffic to our website, which totaled $105 million in the third quarter of 2007.
Other Cost of Revenues - Other cost of revenues, which is comprised primarily of data center operational expenses, credit card processing charges as well as content acquisition costs, increased to $441 million, or 10% of revenues, in the third quarter of 2007, compared to $412 million, or 11% of revenues, in the second quarter of 2007.
Operating Expenses - Operating expenses, other than cost of revenues, were $1.25 billion in the third quarter of 2007, or 30% of revenues, compared to $1.21 billion in the second quarter of 2007, or 31% of revenues. The operating expenses in the third quarter of 2007 included $659 million in payroll-related and facilities expenses, compared to $625 million in the second quarter of 2007.
Stock-Based Compensation (SBC) - In the third quarter of 2007, the total charge related to SBC was $198 million as compared to $242 million in the second quarter of 2007. In the second quarter of 2007, we launched our employee transferable stock option (TSO) program and, in connection with this launch, incurred an SBC modification charge of $62 million.
We currently estimate stock-based compensation charges for grants to employees prior to October 1, 2007 to be approximately $801 million for 2007. This does not include expenses to be recognized related to employee stock awards that are granted after October 1, 2007 or non-employee stock awards that have been or may be granted. We currently anticipate that dilution related to all equity grants to employees will be at or below 2% this year.
Operating Income - GAAP operating income in the third quarter of 2007 was $1.32 billion, or 31% of revenues. This compares to GAAP operating income of $1.10 billion, or 29% of revenues, in the second quarter of 2007. Non-GAAP operating income in the third quarter of 2007 was $1.52 billion, or 36% of revenues. This compares to non-GAAP operating income of $1.35 billion, or 35% of revenues, in the second quarter of 2007.
Net Income - GAAP net income for the third quarter of 2007 was $1.07 billion as compared to $925 million in the second quarter of 2007. Non-GAAP net income was $1.24 billion in the third quarter of 2007, compared to $1.12 billion in the second quarter of 2007. GAAP EPS for the third quarter of 2007 was $3.38 on 317 million diluted shares outstanding, compared to $2.93 for the second quarter of 2007, on 315 million diluted shares outstanding. Non-GAAP EPS for the third quarter of 2007 was $3.91, compared to $3.56 in the second quarter of 2007.
Income Taxes - Our effective tax rate was 27.3% for the third quarter of 2007 compared to 25.5% in the second quarter of 2007.
Cash Flow and Capital Expenditures - Net cash provided by operating activities for the third quarter of 2007 totaled $1.63 billion as compared to $1.23 billion for the second quarter of 2007. In the third quarter of 2007, capital expenditures were $553 million, the majority of which was related to IT infrastructure investments, including data centers, servers, and networking equipment. Free cash flow, an alternative non-GAAP measure of liquidity, is defined as net cash provided by operating activities less capital expenditures. In the third quarter of 2007, free cash flow was $1.08 billion.
We expect to continue to make significant capital expenditures.
A reconciliation of free cash flow to net cash provided by operating activities, the GAAP measure of liquidity, is included at the end of this release.
Cash - As of September 30, 2007, cash, cash equivalents, and marketable securities were $13.1 billion.
On a worldwide basis, Google employed 15,916 full-time employees as of September 30, 2007, up from 13,786 full time employees as of June 30, 2007.
October 19th, 2007
