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Google
Annual Report 2007

Table of contents

  • Page 1
    Google Annual Report 2007

  • Page 2
    ...Search the web via text message. Take he road less traveled without getting lost. Add your favorite ports team to your calendar, and receive reminders when 's playing, so you never miss a game. Make a map of your eighborhood to share with out-of-town guests. Find the izza parlor closest to you right...

  • Page 3
    ...We continue our effort to extract more and more real meaning from the web in order to help people find the right answers. We recently improved universal search, integrating different types of relevant information, such as video, maps, news, books, images, and more, right into your search results. i

  • Page 4
    ... facilitate high-quality content creation and editing are crucial for the Internet's continued growth. Our AdSense program also helps the content ecosystem by letting any author or publisher instantly make money by inserting Google-brokered ads into their pages. This helps them pay people to write...

  • Page 5
    ... money if there is enough competition among advertisers to bid up the auction price. The bad news is that we aren't doing a good enough job yet for this natural pools query and many others. We also happened to have a number of local pool suppliers advertising in the San Francisco area for this query...

  • Page 6
    ... teams, now totaling a few thousand people. I believe DoubleClick's expertise in display advertising will be a tremendous addition to Google and will help open up new opportunities in this important market. Apps We have made tremendous strides in our web applications. I am writing this using Google...

  • Page 7
    ...integrated right into Google Maps (click the Street View button). Google Earth literally goes out of this world with a new Sky mode (just click on the Sky icon). You can see an amazing view of the night sky, complete with super-high resolution images from the Hubble telescope that you can zoom right...

  • Page 8
    ... San Francisco) of clean, cheap energy in years, not decades. If we are successful, we will not only help the world, but also make substantial profits. We continue our efforts to make Google more global. Google is available in 160 different local country domains and 117 languages (including some...

  • Page 9
    Conclusion By organizing the world's information and making it universally accessible and useful, we're helping people worldwide make better decisions and improve their lives. I feel lucky-I am lucky-to be involved in this important ecosystem of better information. While almost all of our effort is ...

  • Page 10

  • Page 11
    ... filer ' Smaller reporting company ' Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ' No È At June 29, 2007, the aggregate market value of shares held by non-affiliates of the Registrant (based upon the closing sale price of such...

  • Page 12

  • Page 13
    ... Factors ...Unresolved Staff Comments ...Properties ...Legal Proceedings ...Submission of Matters to a Vote of Security Holders ...Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ...Selected Financial Data ...Management's Discussion and...

  • Page 14

  • Page 15
    ... an internet connection. Our automated search technology helps people obtain nearly instant access to relevant information from our vast online index. We generate revenue primarily by delivering relevant, cost-effective online advertising. Businesses use our AdWords program to promote their products...

  • Page 16
    ... commercial information through our search services and advertising products. We also present advertisements that are relevant to the information people seek. Our technology automatically rewards ads that users prefer and removes ads that they do not find helpful. Multiple Access Platforms. Mobile...

  • Page 17
    ... and Google uses this descriptive content to better target search results to what users are looking for. Google Webmaster Tools. Google Webmaster Tools provides information to webmasters to help them enhance their understanding of how their web sites interact with the Google search engine. Content...

  • Page 18
    ... help improve the quality of search results by labeling and annotating relevant web pages or by creating specialized, subscribed links for users to get more detailed information about a particular topic. Google Video and YouTube. Google Video and YouTube let users find, upload, view and share video...

  • Page 19
    ... companies that improve the user experience online and on the desktop. It includes programs that help users browse the web faster, remove spyware and viruses and organize their photos. Google Toolbar. Google Toolbar is a free download that adds a Google search box to web browsers (Internet Explorer...

  • Page 20
    ...lets developers search publicly available open-source code, and Google Web Accelerator, a downloadable client application that uses Google's global computer network to enhance user web experience by enabling faster loading of web pages. The Technology Behind Search and Our User Products and Services...

  • Page 21
    ..., low-cost online signup process that lets advertisers implement ad campaigns that can very quickly go live on Google properties and the Google Network. Ads are ranked for display in AdWords based on a combination of the maximum cost per click (CPC) set by the advertiser and click-through rates and...

  • Page 22
    ... customers. Bulk posting. We help businesses launch and manage large ad campaigns with hundreds or even thousands of targeted keywords. The AdWords API and Commercial Developer Program. For large advertisers as well as third parties, Google's free AdWords API service lets developers engineer...

  • Page 23
    ... Google search boxes. We offer this service free to these partners. When visitors to these web sites search either the web site or the internet using these customizable search boxes, we display relevant ads (generally text ads) on the search results pages, targeted to match user search queries...

  • Page 24
    ... structured data such as stock and financial information, web log posts, and weather reports-through text ads targeted to the content of the feed. Like AdSense for search or content, Google shares the majority of the advertising revenue from AdSense for domains and AdSense for feeds with the domain...

  • Page 25
    .... These search appliances are a software and hardware solution that companies can implement to extend Google's search performance to their internal or external information. They leverage our search technology to identify the most relevant pages on public web sites and across the corporate network...

  • Page 26
    ... of the web sites in the Google Network sign up for AdSense using an automated online process. Our direct sales force focuses on building AdSense relationships with leading internet companies. Our global support organization concentrates on helping our advertisers and Google Network members get the...

  • Page 27
    ... services, including Google Checkout, YouTube and our communications tools such as Google Docs, that compete directly with new and established companies that offer communication, information and entertainment services integrated into their products or media properties. We also compete with web sites...

  • Page 28
    ... entrepreneurs to develop and deliver new products, features and services, which could harm our business. We are also subject to federal, state and foreign laws regarding privacy and protection of user data. We post on our web site our privacy policies and practices concerning the use and disclosure...

  • Page 29
    ... in our quarterly results, including fluctuations in sequential revenue growth rates. Available Information Our web site is located at www.google.com, and our investor relations web site is located at http://investor.google.com. The information on or accessible through our web sites is not...

  • Page 30
    ...game company, Go Corporation, a developer of software for mobile devices, and Hewlett-Packard, a provider of technology products, software and services. Omid holds a Masters of Business Administration degree from Stanford University and a Bachelor of Science degree in electrical engineering from San...

  • Page 31
    ... communications solutions. From March 1996 to November 2000, Jonathan held various executive positions at Excite@Home, an internet media company, most recently as its Senior Vice President of Online Products and Services. Jonathan holds a Masters of Business Administration degree from the University...

  • Page 32
    ... services, including Google Checkout, YouTube and our communications tools such as Google Docs, that compete directly with new and established companies that offer communication, information and entertainment services integrated into their products or media properties. We also compete with web sites...

  • Page 33
    ... from ads placed on our Google Network members' sites compared to revenues generated through ads placed on our own sites or if we spend a proportionately larger amount to promote the distribution of certain products, including Google Toolbar. The margin on revenue we generate from our Google Network...

  • Page 34
    ... in web search, online advertising and web based products and services. As a result, we must continue to invest significant resources in research and development in order to enhance our web search technology and our existing products and services and introduce new products and services that people...

  • Page 35
    .... The areas where we may face risks include Implementation or remediation of controls, procedures and policies at the acquired company. Diversion of management time and focus from operating our business to acquisition integration challenges. Coordination of sales and marketing functions. Cultural...

  • Page 36
    ... structures, we may find it increasingly difficult to maintain the beneficial aspects of our corporate culture. This could negatively impact our future success. Our intellectual property rights are valuable, and any inability to protect them could reduce the value of our products, services and brand...

  • Page 37
    ... products and services, including Google Web Search, Google News, Google Video, Google Image Search, Google Book Search and YouTube, infringe another party's rights. Adverse results in these lawsuits may include awards of substantial monetary damages, costly royalty or licensing agreements or orders...

  • Page 38
    ... materials searched and the ads posted by our users, our products and services, or content generated by our users. In addition, the Digital Millennium Copyright Act has provisions that limit, but do not necessarily eliminate, our liability for listing or linking to third-party web sites that include...

  • Page 39
    ... our brand and our operating results. New technologies could block our ads, which would harm our business. Technologies may be developed that can block the display of our ads. Most of our revenues are derived from fees paid to us by advertisers in connection with the display of ads on web pages. As...

  • Page 40
    ... our products and services. There is an ongoing and increasing effort by "index spammers" to develop ways to manipulate our web search results. For example, because our web search technology ranks a web page's relevance based in part on the importance of the web sites that link to it, people have...

  • Page 41
    ... our web search technology developed for these devices, our business could be adversely affected. The number of people who access the internet through devices other than personal computers, including mobile telephones, personal digital assistants (PDAs), smart phones and handheld computers and video...

  • Page 42
    ... Network members have exceeded the related fees we receive from our advertisers. We are obligated under certain agreements to make non-cancelable guaranteed minimum revenue share payments to Google Network members based on their achieving defined performance terms, such as number of search queries...

  • Page 43
    ...-upon service levels, our operations could be disrupted resulting in advertiser, partner or employee dissatisfaction. In addition, our business, reputation and operating results could be adversely affected. To the extent our revenues are paid in foreign currencies, and currency exchange rates become...

  • Page 44
    ... sale of our company or its assets, for the foreseeable future. This concentrated control limits our stockholders' ability to influence corporate matters and, as a result, we may take actions that our stockholders do not view as beneficial. As a result, the market price of our Class A common stock...

  • Page 45
    ... the end of our 2007 fiscal year and that remained unresolved. ITEM 2. PROPERTIES We lease approximately 1.5 million square feet of space in our headquarters in Mountain View, California. We also lease additional research and development, sales and support offices in the United States in Ann Arbor...

  • Page 46
    ... costly to defend, could require us to pay damages and could limit our ability to use certain technologies in the future" and "Our intellectual property rights are valuable, and any inability to protect them could reduce the value of our products, services and brand" in Item 1A of this Annual Report...

  • Page 47
    ..., 2004. Prior to that time, there was no public market for our stock. The following table sets forth for the indicated periods the high and low sales prices per share for our Class A common stock on the Nasdaq Global Select Market. Fiscal Year 2007 Quarters Ended: High Low March 31, 2007 ...June 30...

  • Page 48
    ... date our Class A common stock commenced trading on the Nasdaq Global Select Market) through December 31, 2007 of the cumulative total return for our Class A common stock, The Nasdaq Composite Index, the RDG Internet Composite Index and the S&P 500 Index. Such returns are based on historical results...

  • Page 49
    ... months listed above, we routinely repurchased the shares from our service providers upon their termination of employment pursuant to our right to repurchase unvested shares at the original exercise price under the terms of our Stock Plans and the related stock option agreements. Results of Google...

  • Page 50
    ... share amounts) 2007 Consolidated Statements of Income Data: Revenues ...Costs and expenses: Cost of revenues ...Research and development ...Sales and marketing ...General and administrative ...Contribution to Google Foundation ...Non-recurring portion of settlement of disputes with Yahoo ...Total...

  • Page 51
    ... members' web sites; regarding our future stock-based compensation charges including charges related to our TSO program; that we will continue to pay most of the Google AdSense fees we receive from advertisers to our Google Network members; that we may take steps to improve the relevance of the ads...

  • Page 52
    ... the sale and license of other products and services. Google AdWords is our automated online program that enables advertisers to place targeted text-based and display ads on our web sites and the web sites of our Google Network members. Most of our AdWords customers pay us on a cost-per-click basis...

  • Page 53
    ... on their web sites for our AdWords content. AdSense for content allows a variety of ad types to be shown, including text ads, image ads, Google Video Ads, link units (which are sets of clickable links to topic pages related to page content), themed units (which are regular text ads with graphic...

  • Page 54
    ... these programs to be members of our Google Network. In the fourth quarter of 2006, we acquired YouTube, a consumer media company for people to watch and share videos worldwide through the web. We recognize as revenue the fees charged advertisers each time an ad is displayed on the YouTube site. In...

  • Page 55
    ... from our web sites compared to the rate of growth in revenues from our Google Network members' web sites may vary over time. We are heavily investing in building the necessary employee and systems infrastructures required to manage our growth and develop and promote our products and services, and...

  • Page 56
    ... 2006 2007 Three Months Ended September 30, December 31, 2007 2007 (unaudited) Consolidated Statement of Income Data: Revenues ...Costs and expenses: Cost of revenues ...Research and development ...Sales and marketing ...General and administrative ...Contribution to Google Foundation ...Total costs...

  • Page 57
    ... preceding query, to determine the ads displayed on our search results pages, as well as a change to the clickable area around our AdSense for content text-based ads to only the title and URL to reduce the number of accidental clicks. The sequential quarterly revenue growth rate from our web sites...

  • Page 58
    ... better user experience, which in turn results in more searches, advertisers, and Google Network members and other partners. Revenues realized through the Google Print Ads Program, Google Audio Ads, Google TV Ads, Google Checkout, YouTube, Postini and Search Appliance were not material in any of the...

  • Page 59
    ...costs consist of amounts ultimately paid to our Google Network members under AdSense arrangements and to certain other partners (our "distribution partners") who distribute our toolbar and other products (collectively referred to as "access points") or otherwise direct search queries to our web site...

  • Page 60
    ... revenues coming from our web sites rather than from our Google Network members' web sites. Cost of revenues increased $2,424.1 million from 2006 to 2007. This increase was primarily the result of additional traffic acquisition costs, the depreciation of additional information technology assets...

  • Page 61
    ... those members to whom we have guaranteed minimum revenue share payments. whether we share with existing and new partners proportionately more of the aggregate advertising fees that we earn from paid clicks derived from search queries these partners direct to our web sites. the relative growth rates...

  • Page 62
    ... of service we provide to our advertisers and Google Network members. We also plan to add a significant number of international sales personnel to support our worldwide expansion. In addition, we expect greater stock-based compensation expenses on a per option basis as a result of our TSO program...

  • Page 63
    ... offering we typically granted stock options at exercise prices equal to or less than the value of the underlying stock as determined by our board of directors on the date of option grant. For purposes of financial accounting, we applied hindsight within each year or quarter prior to our initial...

  • Page 64
    ... which we use the BSM method to measure the value of options granted to non-employees at each vesting date to determine the appropriate charge to stock-based compensation. In April 2007, we launched our TSO program. Under the TSO program, certain employees are able to sell vested options granted...

  • Page 65
    ... of Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information about the Google Foundation. Interest Income and Other, Net Interest income and other of $167.3 million in the three months ended December 31, 2007 was primarily comprised...

  • Page 66
    ...Policies and Estimates included elsewhere in this Form 10-K for additional information about our provision for income taxes. A reconciliation of the federal statutory income tax rate to our effective tax rate is set forth in Note 13 of Notes to Consolidated Financial Statements included in this Form...

  • Page 67
    ... quarterly results, including fluctuations in sequential revenue growth rates. Mar 31, 2006 Jun 30, 2006 Quarter Ended Sep 30, Dec 31, Mar 31, Jun 30, 2006 2006 2007 2007 (in thousands, except per share amounts) (unaudited) Sep 30, 2007 Dec 31, 2007 Consolidated Statements of Income Data: Revenues...

  • Page 68
    ... and marketable securities are comprised of highly liquid debt instruments of the U.S. government and its agencies, municipalities in the U.S., time deposits as well as U.S. corporate securities. Note 3 of Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on...

  • Page 69
    ... compensation as a result of the growth in the number of employees, an increase of $93.3 million in accrued revenue share due to the growth in our AdSense programs and the timing of payments made to our Google Network members and a net decrease in income taxes receivable and deferred income taxes of...

  • Page 70
    ... used in acquisitions and other investments of $101.3 million, net of cash acquired. Capital expenditures are mainly for the purchase of information technology assets. In order to manage expected increases in internet traffic, advertising transactions and new products and services, and to support...

  • Page 71
    ... share payments to a small number of our Google Network members over the term of the respective contracts. Under our contracts, these guaranteed payments can vary based on our Google Network members achieving defined performance terms, such as number of advertisements displayed or search queries...

  • Page 72
    ... months due to uncertainties in the timing of tax audit outcomes. As a result, this amount is not included in the table above. Off-Balance Sheet Entities At December 31, 2007 and 2006, we did not have interests in any variable interest entities, as defined by the Financial Accounting Standards Board...

  • Page 73
    ... the current period. Traffic Acquisition Costs We are obligated under certain agreements to make non-cancelable guaranteed minimum revenue share payments to Google Network members based on their achieving defined performance terms, such as number of search queries or advertisements displayed. To the...

  • Page 74
    ...million from forward exchange contracts in place for the months of December 2006 and December 2007. These reasonably possible adverse changes in exchange rates of 10% were applied to total monetary assets denominated in currencies other than the local currencies at the balance sheet dates to compute...

  • Page 75
    ... demand deposit accounts with financial institutions, tax-exempt money market funds and highly liquid debt securities of corporations and municipalities. By policy, we limit the amount of credit exposure to any one issuer. Investments in both fixed rate and floating rate interest earning products...

  • Page 76
    ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Google Inc. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Contents Page Reports of Independent Registered Public Accounting Firm ...Financial Statements Consolidated Balance Sheets ...Consolidated Statements of Income ...Consolidated Statements of ...

  • Page 77
    ... OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM The Board of Directors and Stockholders Google Inc. We have audited the accompanying consolidated balance sheets of Google Inc. as of December 31, 2006 and 2007, and the related consolidated statements of income, stockholders' equity, and cash flows...

  • Page 78
    ... 31, 2006 and 2007, and the related consolidated statements of income, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2007, and our report dated February 14, 2008, expressed an unqualified opinion thereon. /s/ San Jose, California February 14, 2008...

  • Page 79
    ... revenue share, expenses and other assets ...Total current assets ...Prepaid revenue share, expenses and other assets, non-current ...Deferred income taxes, net, non-current ...Non-marketable equity securities ...Property and equipment, net ...Intangible assets, net ...Goodwill ...Total assets...

  • Page 80
    Google Inc. CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) 2005 Year Ended December 31, 2006 2007 Revenues ...Costs and expenses: Cost of revenues (including stock-based compensation expense of $5,579, $17,629, $22,335) ...Research and development (including stock-based ...

  • Page 81
    Google Inc. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (In thousands) Class A and Class B Common Stock Shares Amount Additional Paid-In Capital Amount Accumulated Deferred Stock Other Based Comprehensive Compensation Income Total Stockholders' Equity Retained Earnings Balance at January 1, ...

  • Page 82
    Google Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) 2005 Year Ended December 31, 2006 2007 Operating activities Net income ...Adjustments: Depreciation and amortization of property and equipment ...Amortization of intangibles and other ...Stock-based compensation ...Excess tax benefits...

  • Page 83
    ... to place text-based ads on Google web sites. Ad Words is also available through our direct sales force. AdWords advertisers originally paid us based on the number of times their ads appeared on users' search results pages. In the first quarter of 2002, we began offering AdWords on a cost-per-click...

  • Page 84
    ...Customer (Including a Reseller of the Vendor's Products). In the fourth quarter of 2006, we acquired YouTube, a consumer media company for people to watch and share videos worldwide through the web. We recognize as revenue the fees charged advertisers each time an ad is displayed on the YouTube site...

  • Page 85
    ... Google Network members based on their achieving defined performance terms, such as number of search queries, advertisements displayed. To the extent we expect revenues generated under such an arrangement to exceed the guaranteed minimum revenue share payments, we recognize traffic acquisition costs...

  • Page 86
    ... Stock Units ("RSUs") are measured based on the fair market values of the underlying stock on the dates of grant. Shares are issued on the dates of vest net of the statutory withholding requirements to be paid by us on behalf of our employees. As a result, the actual number of shares issued...

  • Page 87
    ... thousands, except per share amounts): Year Ended December 31, 2005 Net income, as reported ...Add: Stock-based employee compensation expense included in reported net income, net of related tax effects ...Deduct: Total stock-based employee compensation expense under the fair value based method for...

  • Page 88
    ... our expectations. No advertiser or Google Network member generated greater than 10% of revenues in 2005, 2006 and 2007. Fair Value of Financial Instruments The carrying amounts of our financial instruments, including cash and cash equivalents, marketable securities, accounts receivable, accounts...

  • Page 89
    ...Statement of Position No. 98-1, Accounting for Costs of Computer Software Developed or Obtained for Internal Use. We have determined that technological feasibility for our products to be marketed to external users was reached shortly before the release of those products. As a result, the development...

  • Page 90
    ...that includes the enactment date. Foreign Currency Generally, the functional currency of our international subsidiaries is the local currency. The financial statements of these subsidiaries are translated to U.S. dollars using month-end rates of exchange for assets and liabilities, and average rates...

  • Page 91
    ...NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) new fair value measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. SFAS 157 is effective for fiscal years beginning after November 15, 2007. However...

  • Page 92
    Google Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) Note 2. Net Income Per Share of Class A and Class B Common Stock We compute net income per share of Class A and Class B common stock in accordance with SFAS No. 128, Earnings per Share ("SFAS 128") using the two class method. Under ...

  • Page 93
    ...TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) The following table sets forth the computation of basic and diluted net income per share of Class A and Class B common stock (in thousands, except per share amounts): 2005 Class A Class B Year Ended December 31, 2006 Class A Class B 2007 Class A Class...

  • Page 94
    ... $(16,539) $7,699,243 Adjusted Cost As of December 31, 2007 Gross Gross Unrealized Unrealized Gains Losses Fair Value U.S. government notes ...U.S. government agencies ...Municipal securities ...Time deposits ...Auction rate preferred securities ...Total marketable securities ... $ 472,040 2,102...

  • Page 95
    ..., 2006 and 2007. Realized gains and losses are included in interest income and other, net in our accompanying Consolidated Statements of Income. The following table summarizes the estimated fair value of our investments in marketable debt securities designated as available-for-sale classified by the...

  • Page 96
    ... (in thousands): As of December 31, 2006 2007 Information technology assets ...Construction in process ...Land and buildings ...Leasehold improvements ...Furniture and fixtures ...Total ...Less accumulated depreciation and amortization ...Property and equipment, net ... $1,778,028 $2,734,916...

  • Page 97
    ... tax purposes. Customer relationships, patents and developed technology, and tradenames and other intangible assets have weighted-average useful lives of 6.8 years, 4.0 years and 2.6 years from the date of acquisition. These assets are not deductible for tax purposes. Supplemental information on an...

  • Page 98
    ... in-process research and development was expensed at the time of the acquisitions because technological feasibility had not been established and no future alternative uses existed. This amount was included in research and development expenses on the accompanying Consolidated Statements of Income. In...

  • Page 99
    ... December 31, 2007, we capitalized intangible assets of $11.6 million, paid in cash, related to milestone payments for acquisitions completed prior to 2007. Patents and developed technology, customer relationships, and tradenames and other have weighted-average useful lives from the date of purchase...

  • Page 100
    ... minimum revenue share payments to a small number of our Google Network members over the term of the respective contracts. These guaranteed payments can vary based on our Google Network members achieving defined performance terms, such as number of advertisements displayed or search queries. In...

  • Page 101
    ... of our products and services, including Google Web Search, Google News, Google Video, Google Image Search, Google Book Search and YouTube, infringe their rights. Adverse results in these lawsuits may include awards of substantial monetary damages, costly royalty or licensing agreements or orders...

  • Page 102
    ...to 10 votes per share. Shares of Class B common stock may be converted at any time at the option of the stockholder and automatically convert upon sale or transfer to Class A common stock. We refer to Class A and Class B common stock as common stock throughout the notes to these financial statements...

  • Page 103
    ... stock volatility and employee demographics and physical locations that are similar to ours because we had limited relevant historical information to support the expected sale and exercise behavior of our employees who had been granted options recently. Commencing in the fourth quarter of 2007...

  • Page 104
    Google Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) The following table summarizes the activity for our options for the twelve months ended December 31, 2007: Options Outstanding Number of Shares WeightedAverage Exercise Price Weighted-Average Remaining Contractual Term (in years) ...

  • Page 105
    ...any, of the price of our Class A common stock at the time of the sale over the exercise price of the TSO. At December 31, 2007, the number of shares underlying TSOs held by financial institutions was 924,399 and the number of options eligible for participation under the TSO program was approximately...

  • Page 106
    Google Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) At December 31, 2007, there were 2,063 unvested restricted stock units held by a non-employee with a 30 month remaining vesting period. Warrants to Purchase Class A Common Stock We issued warrants to purchase 15,904 shares of Class A...

  • Page 107
    ...to various limitations under Section 382 of the Internal Revenue Code. Uncertain Tax Positions Effective January 1, 2007, we adopted the provisions of FIN 48. This Interpretation clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance...

  • Page 108
    ...TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) The following table summarizes the activity related to our gross unrecognized tax benefits from January 1, 2007 to December 31, 2007 (in thousands): Balance as of January 1, 2007 ...Increases related to prior year tax positions ...Decreases related to...

  • Page 109
    Google Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) Revenues by geography are based on the billing address of the advertiser. The following table sets forth revenues and long-lived assets by geographic area (in thousands): 2005 Year Ended December 31, 2006 2007 Revenues: United ...

  • Page 110
    ... the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer...

  • Page 111
    ...by this item regarding our directors and corporate governance matters is included under the captions "Corporate Governance and Board of Directors Matters" and "Proposals to be Voted On-Proposal Number 1-Election of Directors" in Google's Proxy Statement for its 2008 Annual Meeting of Stockholders to...

  • Page 112
    ... applicable, or the required information is otherwise included. 63 65 66 67 68 69 Schedule II: Valuation and Qualifying Accounts Balance at Beginning of Year Charged to Expenses/ Write-Offs Against Net of Revenue Recoveries (In thousands) Allowance for Doubtful Accounts and Sales Credits Balance...

  • Page 113
    ... Date /S/ ERIC E. SCHMIDT Eric E. Schmidt Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer) Chief Financial Officer (Principal Financial and Accounting Officer) President of Technology, Assistant Secretary and Director President of Products, Assistant...

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    ... 2004 Investor Rights Agreement dated May 31, 2002 Amendment to Investor Rights Agreement dated August 17, 2004 Specimen Class A Common Stock certificate Specimen Class B Common Stock certificate Registration Rights Agreement dated October 9, 2006 (with stockholders of YouTube, Inc.) Current Report...

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    Exhibit Number Description Incorporated by reference herein Form Date 4.05 Form of Warrant Agreement dated April 20, 2007 among Google Inc., Citigroup Global Markets Inc. as Warrant Agent, and Morgan Stanley & Co. Incorporated, Citigroup Global Markets Inc., Credit Suisse Management LLC, and ...

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    ... stock option agreement (TSO Program) Ignite Logic, Inc. 2003 Equity Incentive Plan, as amended Lifescape Solutions, Inc. 2001 Stock Plan, as amended Keyhole, Inc. 2000 Equity Incentive Plan, as amended Picasa, Inc. Employee Bonus Plan YouTube, Inc. 2005 Stock Plan Purchase and Sale Agreement dated...

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    ... Google Inc., Snowmass Holdings Inc., YouTube, Inc. and certain other parties dated as of November 3, 2006, as amended List of subsidiaries of Registrant Consent of Independent Registered Public Accounting Firm Power of Attorney (incorporated by reference to the signature page of this Annual Report...

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    ... financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: February 15, 2008 /S/ ERIC E. SCHMIDT Eric E. Schmidt Chairman of the Board of Directors...

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    ... affect the registrant's ability to record, process, summarize and report financial information; and (c) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: February 15, 2008...

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    ... Exchange Act of 1934 and that information contained in this Form 10-K fairly presents in all material respects the financial condition and results of operations of Google Inc. By: /S/ ERIC E. SCHMIDT Name: Eric E. Schmidt Title: Chairman of the Board of Directors and Chief Executive Officer Date...

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    ... measure the results of their advertising programs, difficulties inherent in integrating acquired businesses, the many risks relating to successful development and marketing of technology, the pressures and challenges that the rapid growth places on our ability to maintain our corporate culture, the...

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    ... looking for your wallet when it's time to chec out. Enter your name, address, phone number, credit card with a single click. Learn how to make Spam carbonara. Enjo the sunshine any time of the day. Sneak a peek at what othe people are searching for online right now. Create and publis a web page...

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