Online ad growth helps Google to five-fold rise in profits
Published 21/09/2010 | 05:00
GOOGLE'S European headquarters in Dublin reported a near five-fold increase in profit before tax last year, it was revealed yesterday.
In accounts just filed with the Companies Registration Office, Google Ireland made a profit before tax of €47.5m in 2009, compared with €10m in 2008.
The profit came on the back of turnover that increased by more than €1bn to €7.9bn.
In 2009, Google Ireland employed 1,387 people -- 70 more than the previous year.
The Dublin-based company said the increase in profits was due to "strong growth" in the online advertising market and developing the business in European markets.
The operation in Dublin serves about 50 countries across the continent. The company said the higher revenue was based on increases in the total number of paid "clicks" and ads displayed through Google's "Adwords" and "Adsense" programs rather than from changes in the average fees realised.
Cost of sales increased to €2.4bn from €2.1bn in 2008, primarily due to "traffic acquisition costs".
These costs consist of amounts paid to Google Network members as well as to partners who direct search queries to Google's websites.
Google pays its Google Network members and other partners a portion of the fees it receives from advertisers.
Staffing levels at the company's offices have doubled since 2006 and as a result, payroll costs have increased from €55m to €130m over the same period. At the end of August, Google had some 1,500 people on its books in Dublin.
"These results show that Google Ireland's turnover, revenue and employment numbers grew strongly in 2009," said John Herlihy, Google's vice-president for Global Ad Operations.
"This growth continues into 2010 with the announcement of additional investment in Ireland, which will result in 200 new jobs in Dublin being created in our new 'Geo Operations Centre'."