Exhibit 99.2
Google Inc.
CONSOLIDATED BALANCE SHEETS
(In millions)
|
| | | | | | | |
| | As of December 31, 2011 | | As of December 31, 2012 |
| | | | (unaudited) |
| Assets | | | |
| Current assets: | | | |
| Cash and cash equivalents | $ | 9,983 |
| | $ | 14,778 |
|
| Marketable securities | 34,643 |
| | 33,310 |
|
| Accounts receivable, net of allowance | 5,427 |
| | 7,885 |
|
| Inventories | 35 |
| | 505 |
|
| Receivable under reverse repurchase agreements | 745 |
| | 700 |
|
| Deferred income taxes, net | 215 |
| | 1,144 |
|
| Prepaid revenue share, expenses and other assets | 1,710 |
| | 2,132 |
|
| Total current assets | 52,758 |
| | 60,454 |
|
| Prepaid revenue share, expenses and other assets, non-current | 499 |
| | 2,011 |
|
| Non-marketable equity securities | 790 |
| | 1,469 |
|
| Property and equipment, net | 9,603 |
| | 11,854 |
|
| Intangible assets, net | 1,578 |
| | 7,473 |
|
| Goodwill | 7,346 |
| | 10,537 |
|
| Total assets | $ | 72,574 |
| | $ | 93,798 |
|
| Liabilities and Stockholders’ Equity | | | |
| Current liabilities: | | | |
| Accounts payable | $ | 588 |
| | $ | 2,012 |
|
| Short-term debt | 1,218 |
| | 2,549 |
|
| Accrued compensation and benefits | 1,818 |
| | 2,239 |
|
| Accrued expenses and other current liabilities | 1,370 |
| | 3,258 |
|
| Accrued revenue share | 1,168 |
| | 1,471 |
|
| Securities lending payable | 2,007 |
| | 1,673 |
|
| Deferred revenue | 547 |
| | 895 |
|
| Income taxes payable, net | 197 |
| | 240 |
|
| Total current liabilities | 8,913 |
| | 14,337 |
|
| Long-term debt | 2,986 |
| | 2,988 |
|
| Deferred revenue, non-current | 44 |
| | 100 |
|
| Income taxes payable, non-current | 1,693 |
| | 2,046 |
|
| Deferred income taxes, net, non-current | 287 |
| | 1,872 |
|
| Other long-term liabilities | 506 |
| | 740 |
|
| Stockholders’ equity: | | | |
| Common stock and additional paid-in capital | 20,264 |
| | 22,835 |
|
| Accumulated other comprehensive income | 276 |
| | 538 |
|
| Retained earnings | 37,605 |
| | 48,342 |
|
| Total stockholders’ equity | 58,145 |
| | 71,715 |
|
| Total liabilities and stockholders’ equity | $ | 72,574 |
| | $ | 93,798 |
|
Google Inc.
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except share amounts which are reflected in thousands and per share amounts)
|
| | | | | | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | December 31, | | December 31, |
| | 2011 | | 2012 | | 2011 | | 2012 |
| | (unaudited) | | | | (unaudited) |
| Revenues: | | | | | | | |
| Google (advertising and other) | $ | 10,584 |
| | $ | 12,905 |
| | $ | 37,905 |
| | $ | 46,039 |
|
| Motorola Mobile (hardware and other) | — |
| | 1,514 |
| | — |
| | 4,136 |
|
| Total revenues | 10,584 |
| | 14,419 |
| | 37,905 |
| | 50,175 |
|
| Costs and expenses: | | | | | | | |
Cost of revenues - Google (advertising and other) (1) | 3,702 |
| | 4,963 |
| | 13,188 |
| | 17,176 |
|
Cost of revenues - Motorola Mobile (hardware and other) (1) | — |
| | 1,250 |
| | — |
| | 3,458 |
|
Research and development (1) | 1,298 |
| | 1,935 |
| | 5,162 |
| | 6,793 |
|
Sales and marketing (1) | 1,268 |
| | 1,751 |
| | 4,589 |
| | 6,143 |
|
General and administrative (1) | 809 |
| | 1,126 |
| | 2,724 |
| | 3,845 |
|
| Charge related to the resolution of Department of Justice investigation | — |
| | — |
| | 500 |
| | — |
|
| Total costs and expenses | 7,077 |
| | 11,025 |
| | 26,163 |
| | 37,415 |
|
| Income from operations | 3,507 |
| | 3,394 |
| | 11,742 |
| | 12,760 |
|
| Interest and other income, net | (18 | ) | | 152 |
| | 584 |
| | 626 |
|
| Income from continuing operations before income taxes | 3,489 |
| | 3,546 |
| | 12,326 |
| | 13,386 |
|
| Provision for income taxes | 784 |
| | 639 |
| | 2,589 |
| | 2,598 |
|
| Net income from continuing operations | 2,705 |
| | 2,907 |
| | 9,737 |
| | 10,788 |
|
| Net loss from discontinued operations | — |
| | (21 | ) | | — |
| | (51 | ) |
| Net Income | $ | 2,705 |
| | $ | 2,886 |
| | $ | 9,737 |
| | $ | 10,737 |
|
| Net income (loss) per share - basic: | | | | | | | |
| Continuing operations | $ | 8.34 |
| | $ | 8.83 |
| | $ | 30.17 |
| | $ | 32.97 |
|
| Discontinued operations | — |
| | (0.06 | ) | | — |
| | (0.16 | ) |
| Net income per share - basic | $ | 8.34 |
| | $ | 8.77 |
| | $ | 30.17 |
| | $ | 32.81 |
|
| Net income (loss) per share - diluted | | | | | | | |
| Continuing operations | $ | 8.22 |
| | $ | 8.68 |
| | $ | 29.76 |
| | $ | 32.46 |
|
| Discontinued operations | — |
| | (0.06 | ) | | — |
| | (0.15 | ) |
| Net income per share - diluted | $ | 8.22 |
| | $ | 8.62 |
| | $ | 29.76 |
| | $ | 32.31 |
|
| Shares used in per share calculation - basic | 324,204 |
| | 329,363 |
| | 322,778 |
| | 327,213 |
|
| Shares used in per share calculation - diluted | 329,002 |
| | 334,977 |
| | 327,214 |
| | 332,305 |
|
(1) Includes stock-based compensation expense as follows: | | | | | | | |
| Cost of revenues - Google (advertising and other) | $ | 77 |
| | $ | 101 |
| | $ | 249 |
| | $ | 359 |
|
| Cost of revenues - Motorola Mobile (hardware and other) | — |
| | 4 |
| | — |
| | 14 |
|
| Research and development | 266 |
| | 364 |
| | 1,061 |
| | 1,325 |
|
| Sales and marketing | 105 |
| | 130 |
| | 361 |
| | 498 |
|
| General and administrative | 88 |
| | 109 |
| | 303 |
| | 453 |
|
| | $ | 536 |
| | $ | 708 |
| | $ | 1,974 |
| | $ | 2,649 |
|
Google Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
|
| | | | | | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | December 31, | | December 31, |
| | 2011 | | 2012 | | 2011 | | 2012 |
| Operating activities | (unaudited) | | | | (unaudited) |
| Net income | $ | 2,705 |
| | $ | 2,886 |
| | $ | 9,737 |
| | $ | 10,737 |
|
| Adjustments: | | | | | | | |
| Depreciation and amortization of property and equipment | 385 |
| | 630 |
| | 1,396 |
| | 1,988 |
|
| Amortization of intangible and other assets | 118 |
| | 323 |
| | 455 |
| | 974 |
|
| Stock-based compensation expense | 536 |
| | 716 |
| | 1,974 |
| | 2,692 |
|
| Excess tax benefits from stock-based award activities | (25 | ) | | (75 | ) | | (86 | ) | | (188 | ) |
| Deferred income taxes | (183 | ) | | (289 | ) | | 343 |
| | (266 | ) |
| Impairment of equity investments | 110 |
| | — |
| | 110 |
| | — |
|
| Gain on divestiture of business | — |
| | — |
| | — |
| | (188 | ) |
| Other | 3 |
| | (4 | ) | | 6 |
| | (28 | ) |
| Changes in assets and liabilities, net of effects of acquisitions and divestiture: | | | | | | | |
| Accounts receivable | (909 | ) | | (559 | ) | | (1,156 | ) | | (787 | ) |
| Income taxes, net | 463 |
| | 156 |
| | 731 |
| | 1,492 |
|
| Inventories | (12 | ) | | 113 |
| | (30 | ) | | 301 |
|
| Prepaid revenue share, expenses and other assets | (104 | ) | | 382 |
| | (232 | ) | | (833 | ) |
| Accounts payable | 29 |
| | (225 | ) | | 101 |
| | (499 | ) |
| Accrued expenses and other liabilities | 540 |
| | 278 |
| | 795 |
| | 762 |
|
| Accrued revenue share | 189 |
| | 356 |
| | 259 |
| | 299 |
|
| Deferred revenue | 79 |
| | (19 | ) | | 162 |
| | 163 |
|
| Net cash provided by operating activities | 3,924 |
| | 4,669 |
| | 14,565 |
| | 16,619 |
|
| Investing activities | | | | | | | |
| Purchases of property and equipment | (951 | ) | | (1,020 | ) | | (3,438 | ) | | (3,273 | ) |
| Purchases of marketable securities | (17,979 | ) | | (9,164 | ) | | (61,672 | ) | | (33,410 | ) |
| Maturities and sales of marketable securities | 15,639 |
| | 5,380 |
| | 48,746 |
| | 35,180 |
|
| Investments in non-marketable equity securities | (70 | ) | | (450 | ) | | (428 | ) | | (696 | ) |
| Cash collateral related to securities lending | (1,048 | ) | | (13 | ) | | (354 | ) | | (334 | ) |
| Investments in reverse repurchase agreements | 400 |
| | (150 | ) | | 5 |
| | 45 |
|
| Acquisitions, net of cash acquired and proceeds received from divestiture, and purchases of intangibles and other assets | (550 | ) | | (97 | ) | | (1,900 | ) | | (10,568 | ) |
| Net cash used in investing activities | (4,559 | ) | | (5,514 | ) | | (19,041 | ) | | (13,056 | ) |
| Financing activities | | | | | | | |
| Net proceeds (payments) related to stock-based award activities | 15 |
| | (98 | ) | | (5 | ) | | (287 | ) |
| Excess tax benefits from stock-based award activities | 25 |
| | 75 |
| | 86 |
| | 188 |
|
| Proceeds from issuance of debt, net of costs | 2,125 |
| | 3,984 |
| | 10,905 |
| | 16,109 |
|
| Repayments of debt | (2,125 | ) | | (4,653 | ) | | (10,179 | ) | | (14,781 | ) |
| Net cash provided by (used in) financing activities | 40 |
| | (692 | ) | | 807 |
| | 1,229 |
|
| Effect of exchange rate changes on cash and cash equivalents | (52 | ) | | 55 |
| | 22 |
| | 3 |
|
| Net increase (decrease) in cash and cash equivalents | (647 | ) | | (1,482 | ) | | (3,647 | ) | | 4,795 |
|
| Cash and cash equivalents at beginning of period | 10,630 |
| | 16,260 |
| | 13,630 |
| | 9,983 |
|
| Cash and cash equivalents at end of period | $ | 9,983 |
| | $ | 14,778 |
| | $ | 9,983 |
| | $ | 14,778 |
|
The following table presents our consolidated revenues by revenue source (in millions):
|
| | | | | | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | December 31, | | December 31, |
| | 2011 | | 2012 | | 2011 | | 2012 |
| | (unaudited) | | | | (unaudited) |
| Advertising revenues: | | | | | | | |
| Google websites | $ | 7,294 |
| | $ | 8,640 |
| | $ | 26,145 |
| | $ | 31,221 |
|
| Google Network Members’ websites | 2,880 |
| | 3,436 |
| | 10,386 |
| | 12,465 |
|
| Total advertising revenues | 10,174 |
| | 12,076 |
| | 36,531 |
| | 43,686 |
|
| Other revenues | 410 |
| | 829 |
| | 1,374 |
| | 2,353 |
|
| Total Google revenues (advertising and other) | 10,584 |
| | 12,905 |
| | 37,905 |
| | 46,039 |
|
| Total Motorola Mobile revenues (hardware and other) | — |
| | 1,514 |
| | — |
| | 4,136 |
|
| Consolidated revenues | $ | 10,584 |
| | $ | 14,419 |
| | $ | 37,905 |
| | $ | 50,175 |
|
The following table presents our Google revenues, by revenue source, as a percentage of Google revenues:
|
| | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | December 31, | | December 31, |
| | 2011 | | 2012 | | 2011 | | 2012 |
| | (unaudited) | | | | (unaudited) |
| Advertising revenues: | | | | | | | |
| Google websites | 69 | % | | 67 | % | | 69 | % | | 68 | % |
| Google Network Members’ websites | 27 | % | | 27 | % | | 27 | % | | 27 | % |
| Total advertising revenues | 96 | % | | 94 | % | | 96 | % | | 95 | % |
| Other revenues | 4 | % | | 6 | % | | 4 | % | | 5 | % |
| Google revenues | 100 | % | | 100 | % | | 100 | % | | 100 | % |
