Google 2010 Annual Report Download - page 51

The following table presents our unaudited quarterly results of operations as a percentage of revenues for the
eight quarters ended December 31, 2010:
Quarter Ended
Mar 31,
2009 Jun 30, 2009 Sep 30, 2009 Dec 31, 2009 Mar 31, 2010 Jun 30, 2010 Sep 30, 2010 Dec 31, 2010
Revenues ............................. 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Costs and expenses:
Cost of revenues .................. 38.1 38.2 37.4 36.1 36.2 36.2 35.0 34.9
Research and development ......... 11.6 12.8 12.7 11.0 12.1 13.2 13.6 12.5
Sales and marketing . . . . . . . . . . . . . . . 7.9 8.5 8.4 8.7 9.0 9.2 9.1 10.7
General and administrative . . . . . . . . . 8.2 6.6 6.6 7.0 6.0 6.7 7.3 6.6
Total costs and expenses ............... 65.8 66.1 65.1 62.8 63.3 65.3 65.0 64.7
Income from operations ................ 34.2 33.9 34.9 37.2 36.7 34.7 35.0 35.3
Interest and other income (expense),
net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.1 (0.3) (0.1) 1.3 0.3 1.0 2.2 1.9
Income before income taxes ............ 34.3 33.6 34.8 38.5 37.0 35.7 37.2 37.2
Provision for income taxes . . . . . . . . . . . . . . 8.5 6.7 7.2 8.9 8.1 8.7 7.5 7.1
Net income ........................... 25.8% 26.9% 27.6% 29.6% 28.9% 27.0% 29.7% 30.1%
Liquidity and Capital Resources
In summary, our cash flows are as follows (in millions):
Year Ended December 31,
2008 2009 2010
Net cash provided by operating activities .................................... $7,853 $ 9,316 $ 11,081
Net cash used in investing activities ......................................... (5,319) (8,019) (10,680)
Net cash provided by financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87 233 3,050
At December 31, 2010, we had $35.0 billion of cash, cash equivalents, and marketable securities. Cash
equivalents and marketable securities are comprised of highly liquid debt instruments of the U.S. government and
its agencies, municipalities in the U.S., debt instruments issued by foreign governments, time deposits, money
market and other funds, including cash collateral received related to our securities lending program, mortgage-
backed securities, and corporate securities.
As of December 31, 2010, $16.7 billion of the $35.0 billion of cash, cash equivalents, and marketable
securities was held by our foreign subsidiaries. If these funds are needed for our operations in the U.S., we would be
required to accrue and pay U.S. taxes to repatriate these funds. However, our intent is to permanently reinvest
these funds outside of the U.S. and our current plans do not demonstrate a need to repatriate them to fund our U.S.
operations.
Our principal sources of liquidity are our cash, cash equivalents, and marketable securities, as well as the cash
flow that we generate from our operations. At December 31, 2010, we had unused letters of credit for
approximately $65 million. We believe that our sources of funding will be sufficient to satisfy our currently
anticipated cash requirements through at least the next 12 months. Our liquidity could be negatively affected by a
decrease in demand for our products and services. In addition, we may make acquisitions or license products and
technologies complementary to our business and may need to raise additional capital through future debt or equity
financing to provide for greater flexibility to fund any such acquisitions and licensing activities. Additional financing
may not be available at all or on terms favorable to us.
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