Google earnings preview: Search for 'how to print money'

Judging by Wall Street sentiment, Google (GOOG) is poised to report strong earnings after the stock market closes today. And even if much of the positive vibe surrounding Google -- and there's a lot -- is already priced into the stock, which is up 70 percent since its March lows, many analysts believe there is still substantial upside potential.

Wall Street analysts are expecting Google to post $4.23 billion in net revenue, and earnings per share of $5.39 for the third quarter. That would represent a four percent gain over last year -- not the double digit growth Google experienced in its early days, but nice for a mature company in a deep recession.

Here's what to listen for from company executives today:
Online ad spending: Google has long insisted that it is better poised than its rivals to weather economic downturns due to the reliability and transparency of its Web search ads. Online advertising has dropped precipitously over the last year, but it will come back -- and indeed grow larger than it ever was, once the economy rebounds. Listen for the company to provide a health report for Web ad spending and in particular, listen for any comments about display advertising, which has been seen as particularly soft lately. Given that Yahoo (YHOO) and AOL (which publishes DailyFinance) have a healthy chunk of the display market, it's a field Google is eyeing hungrily. "We view YouTube's success along with the DoubleClick Ad Exchange as ways for Google to gain meaningful share of the display ad market, both on and off Google properties," Broadpoint AMTech analyst Ben Schachter wrote in a recent note to clients.

Android: It's been a year since T-Mobile introduced the first open source Android phone, the G1. Since then, the platform has made great strides -- the new Android-powered HTC Hero, which Sprint released last Sunday, is a stunning device. Last week, at the CTIA, the Wireless Association trade show, Android had something of a coming-out party. Google views Android as a key component in its campaign to move into wireless devices and mobile advertising, and although Apple's iPhone remains the "it" device for most tech-savvy consumers, new Android-powered devices are coming to market and in the works. Listen for the company's executives to offer an update on the company's mobile efforts -- in particular, listen for any news regarding the highly anticipated new version of the Android OS, 2.0.

Chrome: Google, as is its wont, has a predilection for experimenting in areas that do not at first glance seem essential to its core business of Web search advertising. One such field is Web browsing, where Google has been trying to push its alternative to market leader Microsoft's Internet Explorer -- with limited success. Earlier this year, Google announced that it would offer an entirely new, Web-based operating system built around its browser offering, Chrome. Listen for company executives to explain how they plan -- or at least hope -- to knock Microsoft off its market leading pedestal in browsers and consumer operating systems.

Wave: Google has touted its new Wave collaboration tool as the next generation in online work management, but many tech bloggers have panned the initial offering. Among the greater public, few are even aware it exists -- and fewer still know how to use it. Google hopes to change that. It spent over two years developing the product and clearly believes it will play a key role in the company's efforts to shift the locus of computing from the desktop to the Web -- so-called cloud computing. Listen for executives to provide an update on Wave, and perhaps to explain how they actually intend to get people to use it.

YouTube: Google's YouTube online video service is by far the most popular in the world, but how will it make money? Schacter expects YouTube's "clear positive trends will also provide a boost to revenue in the quarter." YouTube said recently it has served 1 billion videos -- all it needs to do now it serve up the billions of dollars of revenue thought by many (though not me) to justify the $1.65 billion Google paid for it in 2006. Listen for company executives to provide more guidance on the how improvements to YouTube's business model is going, although Schachter's wished-for "specifics about revenue and profitability at YouTube" may be a tall order.

Update 6:30 p.m. EST: Google earnings blow out Wall Street estimates on cost control, click growth. Google continued to print money last quarter, according to Wednesday's earnings report, which handily topped Wall Street estimates, sending the company's stock price nearly three percent higher in after-hours trading. (See article here.)

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