(GOOG) Google Earnings Beat Quarterly Expectations – Larry Page to Replace Eric Schmidt as CEO

Google Inc. (GOOG) once again announced stellar 4th quarter earnings and revenue numbers, but the big headline came in the form of news that CEO Eric Schmidt will be replaced by Google co-founder Larry Page. Schmidt will assume an Executive Chairman role once he steps down as CEO this April.

Back to the numbers: for the second consecutive quarter, Google has far surpassed Zacks Consensus Estimates for both earnings and revenues. Google posted GAAP EPS of $7.81, topping the upwardly revised consensus of $7.16 per share. The Zacks Consensus Estimate accounts for employee stock-option expenses, as does the GAAP EPS number. Net revenue, which strips out traffic acquisition costs (TAC), came to $6.37 billion, easily clearing the Zacks consensus of $6.06 billion.

Gross revenues reached $8.44 billion, but the company stated that its TAC — which closely tracks Google’s gross margins — came to $2.07 billion in the quarter. TAC is up 14.4% sequentially and 20.3% year over year, and net revenues increased 16.2% from the 3rd quarter of 2010 and are 28.7% higher than in the 4th quarter of 2009.

Analysts had been cautiously optimistic over the course of the quarter, with the Zacks Consensus EPS Estimate climbing steadily from $7.09 per share to $7.16 prior to the earnings report. Six analysts had upwardly revised both 4th quarter and fiscal year 2010 estimates over the past month, with 3 having upped their estimates in the past week.

Investors, however, had been somewhat more wary in Thursday trading before the bell, sending shares down $4.98 or 0.79%. But the positive earnings surprise of 9.1% — and perhaps even the news of the front-office shift — has catapulted GOOG shares in the after-market, which are currently up $17.26 per share, or 2.75%.

In the press release issued by Google, Eric Schmidt will address “deals, partnerships, customers and broader business relationships, government outreach and technology thought leadership” while Larry Page will conduct day-to-day business operations. Google’s other co-founder, Sergey Brin, is said to focus his attention on “strategic projects” and “new products.”

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