Google Earnings Report – Good News for AdSense Publishers?

October 17, 2008

Google doesn’t disclose the percentage of advertising revenue that it shares with AdSense publishers but you can pick some clues from their quarterly earnings data.

There are three sections in the quarterly reports that are interesting from the perspective of AdSense publishers like you and me.

1. Google Network Revenues – This is total advertising revenue generated through AdSense program on sites that aren’t owned by Google (like blogs, NYT, etc.).

2. Traffic Acquisition Costs – This is primarily the amount that Google distributes among AdSense publishers.

3. Paid Clicks – While Google will not share the exact percentage of ad clicks on their network, this column will help you figure out if the number of clicks per impression are increasing or heading south. More clicks mean more revenue both for publishers and Google.

Now let’s compare this earnings data for Q1 2008, Q2 2008 and Q3 2008:

  Q1 2008 Q2 2008 Q3 2008
1. Total Revenue earned by Google from AdSense $ 1.69 billion $ 1.66 billion $ 1.68 billion
2. AdSense Revenue that Google shared with publishers $ 1.49 billion $ 1.47 billion $ 1.50 billion
3. Percentage of revenue share 88.16 % 88.55% 89.29%
4. Paid Clicks n*1.04% n*1.03% n*1.07%

So what does this mean for AdSense publishers. While I am no expert, these numbers clearly say:

1. More people are clicking on Google Ads as is evident from the growth in %age of ad clicks (see #4).

2. The amount of advertising revenue generated from AdSense publisher sites has more or less stayed the same throughout the year (see #1) but Google is distributing a slightly larger share of the pie among AdSense publishers (see #3).