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Looking at the slide, with my limited accounting knowledge, it seems Google has managed to decrease the total cost of expense which contributed to the increase
by zentechen 15y ago
Looking at the slide, with my limited accounting knowledge, it seems Google has managed to decrease the total cost of expense which contributed to the increase in revenue from Q1.
- deleted 15y ago[deleted]
- Hawramani 15y agoI thought revenue was separate from expenses.
- dfranke 15y agoHere's how it works: Revenue = everything your customers pay you. Cost of revenue = expenses that scale up directly with revenue. For a manufacturing company, this would typically consist mainly of what they pay to their suppliers. In Google's case, power and bandwidth are major items. Gross profit = Revenue - cost of revenue Operating expenses = costs that aren't directly tied to revenue, such as payrolls and building leases. Operating expenses also include depreciation of capital assets, the computation of which is somewhat of a black art. Operating profit = Gross profit - operating expenses. Net profit = Operating profit +/- any profit or loss on investing activities, including interest on any money the company has borrowed or lent. (Disclaimer: IANAA)
- ww520 15y agoExcellent concise explanation.
- zentechen 15y agoYou are right. Need to change revenue to "net income".