Google beat Wall Street expectations for its third quarter, reporting net income of $1.35 billion, up from $1.25 billion. Revenue was $5.54 billion, up from $5.37 billion a year ago.
Google-owned sites generated revenue of $3.67 billion, or 67% of total revenue, in the third quarter, up 34% from a year ago. Google’s partner sites generated $1.68 billion, a 30% increase from a year ago.
Perhaps most importantly, capital expenditures finally dropped sequentially, so free cash flow was very strong ($1.7 billion). That's almost a $7 billion free cash flow run-rate. With an enterprise value of about $100 billion, the stock is trading at only 15X cash flow. Google is certainly in great shape to weather through the global economic depression and in great good position to pick up some good tech companies along the way.