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Google Inc.

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CONSOLIDATED STATEMENTS OF INCOME

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(In millions, except share amounts which are reflected in thousands and per share amounts)

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Three Months Ended Twelve Months Ended

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December 31, December 31,

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2011 2012 2011 2012

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(unaudited) (unaudited)

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Revenues:

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Google (advertising and other) $10,584 $12,905 $37,905 $46,039

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Motorola Mobile (hardware and other) - 1,514 - 4,136

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Total revenues 10,584 14,419 37,905 50,175

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Costs and expenses:

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Cost of revenues - Google (advertising and other) (1) 3,702 4,963 13,188 17,176

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Cost of revenues - Motorola Mobile (hardware and other) (1) - 1,250 - 3,458

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Research and development (1) 1,298 1,935 5,162 6,793

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Sales and marketing (1) 1,268 1,751 4,589 6,143

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General and administrative (1) 809 1,126 2,724 3,845

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Charge related to the resolution of Department of Justice investigation - - 500 -

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Total costs and expenses 7,077 11,025 26,163 37,415

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Income from operations 3,507 3,394 11,742 12,760

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Interest and other income, net (18) 152 584 626

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Income from continuing operations before income taxes 3,489 3,546 12,326 13,386

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Provision for income taxes 784 639 2,589 2,598

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Net income from continuing operations 2,705 2,907 9,737 10,788

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Net loss from discontinued operations - (21) - (51)

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Net income $2,705 $2,886 $9,737 $10,737

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Net income (loss) per share - basic:

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Continuing operations $8.34 $8.83 $30.17 $32.97

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Discontinued operations - -0.06 - -0.16

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Net income per share - basic $8.34 $8.77 $30.17 $32.81

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Net income (loss) per share - diluted:

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Continuing operations $8.22 $8.68 $29.76 $32.46

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Discontinued operations - -0.06 - -0.15

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Net income per share - diluted $8.22 $8.62 $29.76 $32.31

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Shares used in per share calculation - basic 324,204 329,363 322,778 327,213

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Shares used in per share calculation - diluted 329,002 334,977 327,214 332,305

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(1) Includes stock-based compensation expense as follows:

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Cost of revenues - Google (advertising and other) $77 $101 $249 $359

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Cost of revenues - Motorola Mobile (hardware and other) - 4 - 14

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Research and development 266 364 1,061 1,325

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Sales and marketing 105 130 361 498

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General and administrative 88 109 303 453

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$536 $708 $1,974 $2,649