Google Case Study (Without Solutions)

7/27/2019 Google Case Study (Without Solutions)
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Corporate Bridge Group
This spreadsheet is designed to be used only in an academic context to illustrate concepts covered in
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any user of the spreadsheet if the spreadsheet is inaccurate.
For further information and queries, please contact
info@educorporatebridge.com
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mailto:info@educorporatebridge.comhttp://www.educorporatebridge.com/http://www.educorporatebridge.com/mailto:info@educorporatebridge.com

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RCH OR

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Total Liabilities 1,434 2,646
Stockholders equity:
Convertible preferred stock, $0.001 par value per share - -
ClassA and Class B common stock, $0.001 par value per share 0 0
Additional paid-in capital 11,883 13,241
Accumulated other comprehensive income 23 113Retained earnings 5,133 9,335
Total stockholders equity 17,040 22,690
Total liabilities and stockholders equity 18,473 25,336
Solvency Ratios
Current ratio 10.0 8.5
Quick ratio 9.6 8.0
Cash ratio 8.6 7.0
Turnover Ratios
Receivables turnover 8.0 7.7
Payables turnover 20.0 23.6
Average receivables collection period 45.5 47.6
Average payment period 18.2 15.5
Cash Conversion Cycle 27 32
Marketable Securities as % of Sales 72.6% 49.0%
Prepaid revenue share, expenses and other assets as % of Sales 4.2% 0
Prepaid revenue share, expenses and other assets, non-current as 4.2% 0
Accrued compensation and benefits as % of COGS 8.3% 8.8%
Accrued expenses and other current liabilities as % of COGS 6.3% 7.0%
Accrued revenue share as % of COGS 8.8% 7.9%
Deferred revenue as % of Sales 1.0% 1.1%
Stock based compensation
Stock based compensation as % of Total Expense
Assumptions
Fixed Assets

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r share amounts)
2008 2009 2010 2011 2012 2013 2014
8,657
7,189
15,846 - - - - - -
2,642
-
286
-
1,404
20,178 - - - - - -
434
-
85
5,234
997
4,840
31,768 - - - - - -
178
-
812
480
533
-
218
82
2,302 - - - - - -
30
890
13
294
Historical

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3,529 - - - - - -
-
0
14,450
22713,562
28,239 - - - - - -
31,768 - - - - - -
8.8 #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
8.2 #DIV/0! #DIV/0!
48.4 #DIV/0! #DIV/0!
44.2 #DIV/0! #DIV/0!
7.5 #DIV/0! #DIV/0!
37 #DIV/0! #DIV/0! - - - -
33.0% 0.0% 0.0%
0 0.0% 0.0%
0 0.0% 0.0%
9.4% #DIV/0! #DIV/0!
5.6% #DIV/0! #DIV/0!
6.2% #DIV/0! #DIV/0!
1.0% 0.0% 0.0%
- - - -
7.4% #DIV/0! #DIV/0!

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- - - - -
10.8% 3.4% 13.7%
5.6% 5.2% 3.6%
15.2% 0.5% 3.6%
1.3% 1.2% 1.1%
0.7 #DIV/0! #DIV/0!
4.2 #DIV/0! #DIV/0!
0.8 #DIV/0! #DIV/0!
60.4% 100.0% 100.0%
30.4% 100.0% 100.0%
19.4% 0.0% 0.0%
15.0% #DIV/0! #DIV/0!
19.4% 0% 0%
68.6% #DIV/0! #DIV/0!
112.5% #DIV/0! #DIV/0!
15.0% #DIV/0! #DIV/0!
0 #DIV/0! #DIV/0!
0 #DIV/0! #DIV/0!
21 #DIV/0! #DIV/0!
27.8% #DIV/0! #DIV/0!

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2015
-
-
-
-

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-

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Corporate Bridge Academy (www.educorporatebridge.com)
Google Inc.CONSOLIDATED STATEMENT OF INCOME
(In millions, except per share amounts)
2006 2007 2008
Revenues 10,605 16,594 21,796
Costs and expenses:
Cost of revenues (including stock-based 4,225 6,649 8,622
Research and development (including stock- 1,229 2,120 2,793
Sales and marketing (including stock-based 850 1,461 1,946
General and administrative (including stock-based 752 1,279 1,803
Total costs and expenses 7,055 11,510 15,164
Income from operations 3,550 5,084 6,632
Impairment of equity investments - - (1,095)
Interest and other income, net 461 590 316
Income before income taxes 4,011 5,674 5,853
Provision for income taxes 934 1,470 1,626
Net income 3,077 4,204 4,227
Net income per share of ClassA and Class B common
Basic 10.21 13.53 13.46
Diluted 9.94 13.29 13.31
Cash paid for interest 0.3 1.3 1.6
Cash paid for taxes 538 883 1224
-396 -588 -402
Vertical Analysis 2006 2007 2008
Revenues 100% 100% 100%
Costs and expenses:
Cost of revenues (including stock-based 40% 40% 40%
Research and development (including stock- 12% 13% 13%
Sales and marketing (including stock-based 8% 9% 9%
General and administrative (including stock-based 7% 8% 8%

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Total costs and expenses 67% 69% 70%
Income from operations 33% 31% 30%
Impairment of equity investments 0% 0% -5%
Interest and other income, net 4% 4% 1%
Income before income taxes 38% 34% 27%
Provision for income taxes 23% 26% 28%
Net income 29% 25% 19%
Horizontal Analysis
Revenues 56% 31%
Costs and expenses:
Cost of revenues (including stock-based 57% 30%
Research and development (including stock- 73% 32%
Sales and marketing (including stock-based 72% 33%
General and administrative (including stock-based 70% 41%
Total costs and expenses 63% 32%
Income from operations 43% 30%
Impairment of equity investments
Interest and other income, net
Income before income taxes 41% 3%
Provision for income taxes 57% 11%
Net income 37% 1%

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2009 2010 2011 2012 2013 2014 2015
23,651 29,321 - - - - -
2009 2010
100% 100% #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!
0% 0% 36% 36% 36% 36% 36%
0% 0% 13% 13% 13% 13% 13%
0% 0% 10% 10% 10% 10% 10%
0% 0% 8% 8% 8% 8% 8%

15/23
#DIV/0! #DIV/0! 21% 21% 21% 21% 21%
9% 24% -100% #DIV/0! #DIV/0! #DIV/0! #DIV/0!
-100% #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!

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Corporate Bridge Academy (www.educorporatebridge.com)
Google Inc.CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
Net income
Adjustments:
Depreciation and amortization of property and equipment
Amortization of intangible and other assets
Stock-based compensation expense
Excess tax benefits from stock-based award activities
Deferred income taxesImpairment of equity investments
Other
Changes in assets and liabilities, net of effects of acquisitions and divestiture:
Accounts receivable
Income taxes, net
Prepaid revenue share, expenses and other assets
Accounts payable
Accrued expenses and other liabilities
Accrued revenue share
Deferred revenue
Net cash provided by operating activities
Investing activities
Purchases of property and equipment
Purchases of marketable securities
Maturities and sales of marketable securities
Investments in non-marketable equity securities
Cash collateral received from securities lending
Investments in reverse repurchase agreements
Acquisitions, net of cash acquired and proceeds received from divestiture, and purchases of intangi
Net cash used in investing activities
Financing activities
Net proceeds (payments) from stock-based award activities
Excess tax benefits from stock-based award activities
Repurchase of common stock in connection with acquisitions
Proceeds from issuance of short-term debt

7/27/2019 G

Google Case Study (Without Solutions)

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Transcript of Google Case Study (Without Solutions)

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