Google’s Slowing Clicks on Ads Worry Investors and Analysts
On Thursday, Google reported its third-quarter earnings and the figures have raised several questions in the minds of the analysts. The earnings report showed that the Internet giant is revealing signs of a slowdown in its extremely profitable business of search advertising.
Google remains profitable in every way, as its search engine still remains as the leading one in desktop computers and mobile phones. It's YouTube and the Google Play store businesses are also rapidly growing. The company earns billions as profit in each and has a cash accumulation of $60 billion.
However the thing which worries the investors is that the company's search engine is gradually revealing signs of ageing. There was a seventeen percent increase on paid clicks on advertisements in the third quarter when compared to the previous year's same time frame. However the second quarter showed an increase of twenty five percent from last earlier.
One thing more that worries the analysts is the cost per click. This is the average price which the company is paid every time there is a click on an ad by the users. There has been a drop in the cost-per-click measurement in the recent years as users now invest more of their time on mobile phones. The mobiles have smaller screens on which it is difficult to place advertisements. The cost- per-click measure fell in the third quarter by two percent when compared to last year same time and remained flat in comparison to the second quarter.
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