This summary is based on the first quarter fiscal 2008 earnings call conducted by Google Inc. (GOOG: chart) on April 17, 2008.

Chief Executive Officer: Eric Schmidt
Chief Financial Officer: George Reyes
Founder and President of Technology: Sergey Brin
Founder and President of Products: Larry Page
SVP of Product Management: Jonathan Rosenberg
SVP of Global Sales and Operations: Omid Kordestani
Director of Investor Relations: Krista Bessinger

Key Investors Issues

- The earnings per share increased to $4.12 as against $3.18 in prior year.
- Quarterly revenue grew 42% over the prior year to $5.19 billion.
- At the end of Q1, the firm had a full-time employee base of 19,156, including over 1,500 from DoubleClick.

First Quarter Fiscal 2008 Financial Highlights

The firm had another strong quarter with gross revenue increasing 42% over Q1 2007 to $5.2 billion.

- Goggle.com performed very well, up 49% year over year to $3.4 billion, driven by strong traffic growth and to a lesser extent, monetization growth.
- AdSense revenue grew 25% over Q1 2007, reflecting solid performance across both the Content and Search networks.
- Aggregate paid clicks include clicks related to ads served on Google properties, as well as ads served on the firm’s partner sites. Aggregate paid clicks grew approximately 20% over Q1 2007 and approximately 4% over Q4. Paid click growth on Google.com in the U.S. remains healthy and other markets are showing strong growth as well.

International revenue increased to $2.65 billion, now accounting for 51% of total revenue.

International markets have tremendous potential for growth. As is typical in the first quarter, the UK was strong with revenues of $803 million and 16% sequential growth as the travel and finance verticals rebounded, as expected from Q4. Revenue growth in EMEA was primarily driven by strong performance in the UK, Benelux and the Nordic countries, fueled by strong pan-European performance in travel. Google also saw solid gains in relatively smaller markets such Ireland, Spain and Italy. Asia and Latin America continue to show impressive growth as well with India, Argentina Australia and Japan being notable performers in the quarter.

The traffic acquisition costs were $1.5 billion or 29% of total advertising revenue, down from 30% in Q4.

AdSense TAC was $1.3 billion, while TAC related to distribution partners and others who direct traffic to the company’s websites totaled $143 million in the quarter. Other cost of revenue, which included $9 million in stock-based compensation increased $108 million over Q4 to $624 million. The largest driver of the increase was the increase in costs related to the firm’s data centers including depreciation, equipment and operations. The management continues to anticipate that other cost of sales could increase going forward.

Other than cost of revenue, operating expenses in Q1 totaled $1.5 billion, including approximately $272 million in stock-based compensation.

Expenses related to payroll and facilities increased $53 million over Q4 to $809 million.

At the end of the quarter, the firm had a full-time employee base of 19,156 including more than 1,500 heads from DoubleClick.

Since the close of the acquisition, the firm has conducted a review of its ongoing headcount requirements and approximately 10% of the US DoubleClick workforce was laid off in early April. An additional 15%, approximately, are expected to leave the company in the U.S. in the near to intermediate term, because they are in a transitional role as they move through the system. These headcount reductions apply only to the US and do not include employees associated with the future planned divestitures of the Performics SEM business. To-date there have been no headcount reductions outside the U.S.

On an organic basis, excluding DoubleClick, Google added approximately 800 employees in Q1, with the majority of new hires in engineering, followed by sales and marketing. The company has implemented and continues to follow a disciplined hiring process in all areas of the organization, but it will continue to invest in its core business both in the US and internationally.

Non-GAAP operating profit, which excludes stock-based compensation, increased to $1.8 billion in Q1.

The non-GAAP operating margins were 35.2%, approximately 30 basis points above Q4.

- The effective tax rate for Q1 was 24%, down from 25% in Q4 of 2007, reflecting the mix of foreign versus domestic earnings.

The operating cash flow remained strong at $1.78 billion with CapEx for the quarter at $842 million.