Google 2008 Annual Report Download - page 72

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Cash used in investing activities in 2008 of $5,319.4 million was attributable to cash consideration used in
acquisitions and other investments of $3,367.5 million primarily related to the acquisition of DoubleClick and
capital expenditures of $2,358.5 million, partially offset by net maturities and sales of marketable securities of
$406.5 million including our investment in Clearwire.
Cash used in investing activities in 2007 of $3,681.6 million was attributable to capital expenditures of
$2,402.8 million, cash consideration used in acquisitions and other investments of $941.2 million, primarily related
to the acquisition of Postini, and net purchases of marketable securities of $337.6 million.
Cash used in investing activities in 2006 of $6,899.2 million was attributable to net purchases of marketable
securities of $3,574.8 million primarily driven by the additional cash raised from our follow-on public stock offering
in April 2006, cash consideration used in acquisitions and other investments of $1,421.6 million primarily related to
our $1.0 billion investment in AOL, and to a lesser extent, the acquisition of dMarc Broadcasting, Inc. and capital
expenditures of $1,902.8 million.
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 our
overall global business expansion, we will make significant investments in data center operations, technology,
corporate facilities and information technology infrastructure in 2009 and thereafter.
In addition, we expect to spend a significant amount of cash on acquisitions and other investments from time
to time. These acquisitions generally enhance the breadth and depth of our expertise in engineering and other
functional areas, our technologies and our product offerings. In connection with certain acquisitions, we are
obligated to make additional cash payments if certain criteria are met. As of December 31, 2008, our remaining
contingent obligations related to these acquisitions was approximately $37 million, which if the criteria are met,
would be recorded as part of the purchase. Since these contingent payments are based on the achievement of
performance targets, actual payments may be substantially lower. Also, in July 2008, we signed an agreement
with Rambler Media to acquire ZAO Begun, a Russian context advertising service, for $140 million in cash, subject
to customary adjustments. On October 22, 2008, the Federal Antimonopoly Service of the Russian Federation
denied consent to the proposed acquisition of ZAO Begun and on January 7, 2009, the acquisition agreement was
terminated.
As part of our philanthropic program, we expect to make donations as well as investments in for-profit
enterprises that aim to alleviate poverty, improve the environment or achieve other socially or economically
progressive objectives. We expect these payments to be made primarily in cash. We authorized up to $175 million
of such payments over the three years ending December 31, 2008, with any unallocated amounts to be rolled over
into the following year. The majority of this authorized amount has been spent or committed.
Cash provided by financing activities in 2008 of $87.6 million was due primarily to excess tax benefits of
$159.1 million from stock-based award activity during the period which represents a portion of the $250.9 million
reduction to income tax payable that we recorded in the year ended December 31, 2008 related to the total direct
tax benefit realized from the exercise, sale or vesting of these awards, partially offset by net payments related to
stock-based award activity of $71.5 million. Cash provided by financing activities in 2007 of $403.1 million was
due primarily to excess tax benefits of $379.2 million from stock-based award activity during the period and net
proceeds from the issuance of common stock pursuant to stock-based award activity of $23.9 million. Cash
provided by financing activities in 2006 of $2,966.4 million was due primarily to net proceeds of $2,063.5 million
raised from the follow-on stock offering, excess tax benefits of $581.7 million from stock-based award activity
during the period and net proceeds from the issuance of common stock pursuant to stock-based award activity of
$321.1 million.
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