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Quarterly Results of Operations
You should read the following tables presenting our quarterly results of operations in conjunction with the
consolidated financial statements and related notes contained elsewhere in this Form 10-K. We have prepared the
unaudited information on the same basis as our audited consolidated financial statements. You should also keep in mind,
as you read the following tables, that our operating results for any quarter are not necessarily indicative of results for any
future quarters or for a full year.
The following table presents our unaudited quarterly results of operations for the eight quarters ended December
2007. This table includes all adjustments, consisting only of normal recurring adjustments, that we consider necessary for
fair presentation of our financial position and operating results for the quarters presented. Both seasonal fluctuations in
internet usage and traditional retail seasonality have affected, and are likely to continue to affect, our business. Internet
usage generally slows during the summer months, and commercial queries typically increase significantly in the fourth
quarter of each year. These seasonal trends have caused and will likely continue to cause, fluctuations in our quarterly
results, including fluctuations in sequential revenue growth rates.
Quarter Ended
Mar 31,
2006 Jun 30,
2006 Sep 30,
2006 Dec 31,
2006 Mar 31,
2007 Jun 30,
2007 Sep 30,
2007 Dec 31,
2007
(in thousands, except per share amounts)
(unaudited)
Consolidated
Statements of
Income Data:
Revenues ........... $2,253,755 $2,455,991 $2,689,673 $3,205,498 $3,663,971 $3,871,985 $4,231,351 $4,826,679
Costs and expenses:
Cost of
revenues ..... 904,119 989,032 1,048,728 1,283,148 1,470,426 1,560,255 1,662,579 1,955,825
Research and
development . 246,599 282,552 312,632 386,806 408,384 532,106 548,712 630,783
Sales and
marketing .... 190,943 196,397 206,972 255,206 302,552 355,604 380,820 422,291
General and
administrative 169,395 172,638 190,010 219,744 261,400 319,405 321,398 377,046
Total costs and
expenses ......... 1,511,056 1,640,619 1,758,342 2,144,904 2,442,762 2,767,370 2,913,509 3,385,945
Income from
operations ........ 742,699 815,372 931,331 1,060,594 1,221,209 1,104,615 1,317,842 1,440,734
Interest income and
other, net ........ 67,919 160,805 108,180 124,139 130,728 137,130 154,428 167,294
Income before income
taxes ............ 810,618 976,177 1,039,511 1,184,733 1,351,937 1,241,745 1,472,270 1,608,028
Provision for income
taxes (1) ......... 218,327 255,100 306,150 154,017 349,775 316,625 402,281 401,579
Net income ......... $ 592,291 $ 721,077 $ 733,361 $1,030,716 $1,002,162 $ 925,120 $1,069,989 $1,206,449
Net income per share
of Class A and
Class B common
stock:
Basic .......... $ 2.02 $ 2.39 $ 2.42 $ 3.36 $ 3.24 $ 2.98 $ 3.44 $ 3.86
Diluted ........ $ 1.95 $ 2.33 $ 2.36 $ 3.29 $ 3.18 $ 2.93 $ 3.38 $ 3.79
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