Nomura Securities on U.S. Advertising: U.S. and Global Search Update (GOOG, FB, YHOO, MSFT)

Nomura Securities on U.S. Advertising: U.S. and Global Search Update.

Google’s July US desktop search query volume was up 1% YoY, but the company lost ~110bp of share of search volume on a sequential basis. Yahoo!/Bing’s performance improved in July, as total query volume grew 2% (after declining the past two months) and the company gained ~115bp of search share compared to June. Google’s global desktop query volume grew 16% in 2Q12, as its share of search was flat sequentially (at ~69%). Yahoo!/Bing continued to lose share of total search volume (down 12bp sequentially to 8%). Global desktop searcher trends also speak to GOOG’s growing dominance (and Yahoo!/Bing’s (Nasdaq: MSFT) struggles), as the total number of people searching on GOOG grew 13% YoY in 2Q12, outpacing the overall market by 320bp. Facebook-searching trends still underscore our thesis that Facebook, as currently structured, is not a threat to Google. We reiterate our Buy ratings on Google (Nasdaq: GOOG) ($750 PT) and Facebook (Nasdaq: FB) ($31.50 PT) and our Neutral rating on Yahoo (Nasdaq: YHOO) ($15 PT).

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