If you could provide a link to a
Google financial statement that lays out their revenue and expenses for Android, I'd appreciate it. IMHO, the only way one could "prove" Android was profitable is if Google says it is.
Google, to my knowledge,
doesn't break out Android revenues, expenses, profit and loss, on their income statement or other regulatory filings. So, to a certain extent, analysts and investors have to look at what the company's executives say, and then draw whatever conclusions you can. I should say that in general I take Google's public statements at face value. If Google says they are activating a half million Android devices a day, then I work on the assumption that is a fact.
What evidence do we have to Android's revenues? Well,
Larry Page recently said that "mobile revenues" were running at a $2.5 billion "annual run rate" in the last quarter. Well and good. But its important to note that "Mobile Revenue" isn't the same as pure Android revenue.
How do we know this? Because, just a few weeks ago, a Google executive testified that
two thirds of mobile revenue comes from iOS devices. And this shouldn't be surprising - since most traffic analysis reports on browsing habits, web-site visitors, and ad-impressions (where Google makes it money) tends to support that assertion.
So, if annual "Mobile Revenue" is $2.5 billion, and iOS devices make up two thirds of that, then only one third is left to be generated by Android, BlackBerry, Symbian, Windows Phone, etc. So the
most that annual Android revenue could be is about $800 million.
We don't know what expenses Google has running and developing Android. But its worth noting that Google has agreed to pay $12 billion to acquire MMI, a money-losing maker of smartphones and other devices. Google's reasons for doing so haven't been publicly announced, but it has been widely speculated that a major reason has been to amass a patent "war chest" with which to defend Android and its carrier partners.
The most revenue they've made this year from Android is $800 million. And, in addition to whatever they've spent writing code, paying lawyers, and running data centers in support of Android, they've also spent $12 billion to defend Android's from patent infringement lawsuits. Obviously, their $12 billion MMI investment isn't going up in smoke overnight. But its pretty hard to say that spending $12 billion plus, in order to make $800 million in revenue, meets most investors definition of "making money."
