"DocumentandEntityInformation"

,"3MonthsEndedMar.
31,2010","Apr.
30,2010ClassAcommonstock","Apr.
30,2010ClassBcommonstock""DocumentType","10-Q""AmendmentFlag","false""DocumentPeriodEndDate","2010-03-31""DocumentFiscalYearFocus","2010""DocumentFiscalPeriodFocus","Q1""TradingSymbol","GOOG""EntityRegistrantName","GoogleInc.
""EntityCentralIndexKey","0001288776""CurrentFiscalYearEndDate","--12-31""EntityFilerCategory","LargeAcceleratedFiler""EntityCommonStock,SharesOutstanding",,"245600411","72886098""CONSOLIDATEDBALANCESHEETS(USD$)""InMillions","Mar.
31,2010","Dec.
31,2009""Currentassets:""Cashandcashequivalents","9192","10198""Marketablesecurities","17322","14287""Accountsreceivable,netofallowanceof$79and$62","3084","3178""Deferredincometaxes,net","399","644""Incometaxesreceivable,net",,"23""Prepaidrevenueshare,expensesandotherassets","1135","837""Totalcurrentassets","31132","29167""Prepaidrevenueshare,expensesandotherassets,non-current","454","415""Deferredincometaxes,net,non-current","446","263""Non-marketableequitysecurities","154","129""Propertyandequipment,net","4773","4845""Intangibleassets,net","790","775""Goodwill","5122","4903""Totalassets","42871","40497""Currentliabilities:""Accountspayable","329","216""Accruedcompensationandbenefits","578","982""Accruedexpensesandothercurrentliabilities","576","570""Accruedrevenueshare","696","694""Deferredrevenue","293","285""Incometaxespayable,net","450""Totalcurrentliabilities","2922","2747""Deferredrevenue,non-current","36","42""Incometaxespayable,net,non-current","1300","1392""Otherlong-termliabilities","330","312""Stockholders'equity:""Convertiblepreferredstock,$0.
001parvalue,100,000sharesauthorized;nosharesissuedandoutstanding","","""Commonstockandadditionalpaid-incapital","16171","15817""Accumulatedothercomprehensiveincome","163","105""Retainedearnings","21949","20082""Totalstockholders'equity","38283","36004""Totalliabilitiesandstockholders'equity","42871","40497""CONSOLIDATEDBALANCESHEETS(Parenthetical)(USD$)""SharedatainThousands","Mar.
31,2010","Dec.
31,2009""Accountsreceivable,allowance","62000000","79000000""Convertiblepreferredstock,parvaluepershare","0.
001","0.
001""Convertiblepreferredstock,sharesauthorized","100000","100000""Convertiblepreferredstock,sharesissued","0","0""Convertiblepreferredstock,sharesoutstanding","0","0""ClassAandClassBcommonstock,parvaluepershare","0.
001","0.
001""ClassAandClassBcommonstock,sharesauthorized","9000000","9000000""Commonstock,parvalue","318000","318000""Commonstock,sharesissued","318274","317772""Commonstock,sharesoutstanding","318274","317772""ClassAcommonstock",,"Commonstock,parvalue","245000","244000""Commonstock,sharesissued","244843","243611""Commonstock,sharesoutstanding","244843","243611""ClassBcommonstock",,"Commonstock,parvalue","73000","74000""Commonstock,sharesissued","73431","74161""Commonstock,sharesoutstanding","73431","74161""CONSOLIDATEDSTATEMENTSOFINCOME(USD$)""InMillions,exceptPerSharedata","3MonthsEndedMar.
31,2010","3MonthsEndedMar.
31,2009""Revenues","6775","5509""Costsandexpenses:""Costofrevenues(includingstock-basedcompensationexpenseof$13and$6)","2452","2102""Researchanddevelopment(includingstock-basedcompensationexpenseof$168and$191)","818","642""Salesandmarketing(includingstock-basedcompensationexpenseof$59and$54)","607","434""Generalandadministrative(includingstock-basedcompensationexpenseof$37and$40)","410","447""Totalcostsandexpenses","4287","3625""Incomefromoperations","2488","1884""Interestincomeandother,net","18","6""Incomebeforeincometaxes","2506","1890""Provisionforincometaxes","551","467""Netincome","1955","1423""NetincomepershareofClassAandClassBcommonstock:""Basic","6.
1500048828125","4.
51000244140625""Diluted","6.
0600048828125","4.
49000244140625""CONSOLIDATEDSTATEMENTSOFINCOME(Parenthetical)(USD$)""InMillions","3MonthsEndedMar.
31,2010","3MonthsEndedMar.
31,2009""Costofrevenues,stock-basedcompensationexpense","6","13""Researchanddevelopment,stock-basedcompensationexpense","191","168""Salesandmarketing,stock-basedcompensationexpense","54","59""Generalandadministrative,stock-basedcompensationexpense","40","37""CONSOLIDATEDSTATEMENTSOFCASHFLOWS(USD$)""InMillions","3MonthsEndedMar.
31,2010","3MonthsEndedMar.
31,2009""Operatingactivities""Netincome","1955","1423""Adjustments:""Depreciationandamortizationofpropertyandequipment","264","321""Amortizationofintangiblesandotherassets","67","82""Stock-basedcompensationexpense","291","277""Excesstaxbenefitsfromstock-basedawardactivities","-12","-32""Deferredincometaxes","-13","-13""Other","2","-21""Changesinassetsandliabilities,netofeffectsofacquisitions:""Accountsreceivable","46","97""Incometaxes,net","381","325""Prepaidrevenueshare,expensesandotherassets","-157","78""Accountspayable","120","22""Accruedexpensesandotherliabilities","-394","-322""Accruedrevenueshare","23","4""Deferredrevenue","11","9""Netcashprovidedbyoperatingactivities","2584","2250""Investingactivities""Purchasesofpropertyandequipment","-239","-263""Purchasesofmarketablesecurities","-12487","-5245""Maturitiesandsalesofmarketablesecurities","9495","5110""Investmentsinnon-marketableequitysecurities","-3","-19""Acquisitions,netofcashacquired,andpurchasesofintangibleandotherassets","-190","-2""Netcashusedininvestingactivities","-3424","-419""Financingactivities""Netpaymentsrelatedtostock-basedawardactivities","-38","-37""Excesstaxbenefitsfromstock-basedawardactivities","12","32""Repurchaseofcommonstockinconnectionwithanacquisition","-97""Netcashusedinfinancingactivities","-123","-5""Effectofexchangeratechangesoncashandcashequivalents","-43","-57""Netincrease(decrease)incashandcashequivalents","-1006","1769""Cashandcashequivalentsatbeginningofyear","10198","8657""Cashandcashequivalentsatendofperiod","9192","10426""Supplementaldisclosuresofcashflowinformation""Cashpaidforincometaxes","179","162""Non-cashfinancingactivity:""Fairvalueofcommonstockissuedinconnectionwithanacquisition","95""GoogleInc.
andSummaryofSignificantAccountingPolicies","3MonthsEndedMar.
31,2010""GoogleInc.
andSummaryofSignificantAccountingPolicies","Note1.
GoogleInc.
andSummaryofSignificantAccountingPoliciesNatureofOperationsWewereincorporatedinCaliforniainSeptember1998.
Wewerere-incorporatedintheStateofDelawareinAugust2003.
Weprovidehighlytargetedadvertisingandglobalinternetsearchsolutionsaswellashostedapplications.
BasisofConsolidationTheConsolidatedFinancialStatementsincludetheaccountsofGoogleandourwholly-ownedsubsidiaries.
Allintercompanybalancesandtransactionshavebeeneliminated.
UnauditedInterimFinancialInformationTheaccompanyingConsolidatedBalanceSheetasofMarch31,2010,theConsolidatedStatementsofIncomeforthethreemonthsendedMarch31,2009and2010,andtheConsolidatedStatementsofCashFlowsforthethreemonthsendedMarch31,2009and2010areunaudited.
TheseunauditedinterimConsolidatedFinancialStatementshavebeenpreparedinaccordancewithU.
S.
generallyacceptedaccountingprinciples(GAAP).
Inouropinion,theunauditedinterimConsolidatedFinancialStatementsincludealladjustmentsofanormalrecurringnaturenecessaryforthefairpresentationofourfinancialpositionasofMarch31,2010,ourresultsofoperationsforthethreemonthsendedMarch31,2009and2010,andourcashflowsforthethreemonthsendedMarch31,2009and2010.
TheresultsofoperationsforthethreemonthsendedMarch31,2010arenotnecessarilyindicativeoftheresultstobeexpectedfortheyearendingDecember31,2010.
TheseunauditedinterimConsolidatedFinancialStatementsshouldbereadinconjunctionwiththeConsolidatedFinancialStatementsandrelatednotesincludedinour2009AnnualReportonForm10-KfiledonFebruary12,2010.
UseofEstimatesThepreparationofinterimConsolidatedFinancialStatementsinconformitywithaccountingprinciplesgenerallyacceptedintheUnitedStatesrequiresustomakeestimatesandassumptionsthataffecttheamountsreportedanddisclosedinthefinancialstatementsandtheaccompanyingnotes.
Actualresultscoulddiffermateriallyfromtheseestimates.
Onanongoingbasis,weevaluateourestimates,includingthoserelatedtotheaccountsreceivableandsalesallowances,fairvaluesoffinancialinstruments,intangibleassetsandgoodwill,usefullivesofintangibleassetsandpropertyandequipment,fairvaluesofstock-basedawards,andincometaxes,amongothers.
Webaseourestimatesonhistoricalexperienceandonvariousotherassumptionsthatarebelievedtobereasonable,theresultsofwhichformthebasisformakingjudgmentsaboutthecarryingvaluesofassetsandliabilities.
EffectofRecentAccountingPronouncementsInOctober2009,theFinancialAccountingStandardsBoard(FASB)issuedanewaccountingstandardwhichprovidesguidanceforarrangementswithmultipledeliverables.
Specifically,thenewstandardrequiresanentitytoallocateconsiderationattheinceptionofanarrangementtoallofitsdeliverablesbasedontheirrelativesellingprices.
Intheabsenceofthevendor-specificobjectiveevidenceorthird-partyevidenceofthesellingprices,considerationmustbeallocatedtothedeliverable""NetIncomePerShareofClassAandClassBCommonStock","3MonthsEndedMar.
31,2010""NetIncomePerShareofClassAandClassBCommonStock","Note2.
NetIncomePerShareofClassAandClassBCommonStockThefollowingtablesetsforththecomputationofbasicanddilutednetincomepershareofClassAandClassBcommonstock(inmillions,exceptshareamountswhicharereflectedinthousandsandpershareamounts):FortheThreeMonthsEndedMarch31,20092010(unaudited)ClassAClassBClassAClassBBasicnetincomepershare:Numerator:Allocationofundistributedearnings$1,085$338$1,501$454Denominator:Weighted-averagecommonsharesoutstanding240,30374,965244,09973,796Less:Weighted-averageunvestedcommonsharessubjecttorepurchaseorcancellation(16)Numberofsharesusedinpersharecomputation240,28774,965244,09973,796Basicnetincomepershare$4.
51$4.
51$6.
15$6.
15Dilutednetincomepershare:Numerator:Allocationofundistributedearningsforbasiccomputation$1,085$338$1,501$454ReallocationofundistributedearningsasaresultofconversionofClassBtoClassAshares338454ReallocationofundistributedearningstoClassBshares(1)(6)Allocationofundistributedearnings$1,423$337$1,955$448Denominator:Numberofsharesusedinbasiccomputation240,28774,965244,09973,796Weighted-averageeffectofdilutivesecuritiesAdd:ConversionofClassBtoClassAcommonsharesoutstanding74,96573,796Unvestedcommonsharessubjecttorepurchaseorcancellation16EmployeestockoptionsandwarrantsunderTransferableStockOptionprogram1,767863,59182Restrictedsharesandrestrictedstockunits1861,122Numberofsharesusedinpersharecomputation317,22175,051322,60873,878Dilutednetincomepershare$4.
49$4.
49$6.
06$6.
06ThenetincomepershareamountsarethesameforClassAandClassBbecausetheholdersofeachclassarelegallyentitledtoequalpersharedistributionswhetherthroughdividendsorinliquidation.
""CashandInvestments","3MonthsEndedMar.
31,2010""CashandInvestments","Note3.
CashandInvestmentsCash,cashequivalents,andmarketablesecuritiesconsistofthefollowing(inmillions):AsofDecember31,2009AsofMarch31,2010(unaudited)Cashandcashequivalents:Cash$4,303$3,570Cashequivalents:Timedeposits3,7402,253Moneymarketmutualfunds2,1533,345U.
S.
governmentagencies2Corporatedebtsecurities24Totalcashandcashequivalents10,1989,192Marketablesecurities:Timedeposits1,250750Moneymarketmutualfunds285U.
S.
governmentagencies3,7033,348U.
S.
governmentnotes2,4922,184Foreigngovernmentbonds37332Municipalsecurities2,1302,222Corporatedebtsecurities2,8224,885Agencyresidentialmortgage-backedsecurities1,5783,338Commercialmortgage-backedsecurities4847Marketableequitysecurity199211Totalmarketablesecurities14,28717,322Totalcash,cashequivalentsandmarketablesecurities$24,485$26,514Thefollowingtablesummarizesunrealizedgainsandlossesrelatedtoourinvestmentsinmarketablesecuritiesdesignatedasavailable-for-sale(inmillions):AsofDecember31,2009AdjustedCostGrossUnrealizedGainsGrossUnrealizedLossesFairValueTimedeposits$1,250$$$1,250Moneymarketmutualfunds2828U.
S.
governmentagencies3,7005(2)3,703U.
S.
governmentnotes2,520(28)2,492Foreigngovernmentbonds3737Municipalsecurities2,100302,130Corporatedebtsecurities2,82613(17)2,822Agencyresidentialmortgage-backedsecurities1,5855(12)1,578Commercialmortgage-backedsecurities47148Marketableequitysecurity14554199Total$14,238$108$(59)$14,287AsofMarch31,2010AdjustedCostGrossUnrealizedGainsGrossUnrealizedLossesFairValue(unaudited)Timedeposits$750$$$750Moneymarketmutualfunds55U.
S.
governmentagencies3,3503(5)3,348U.
S.
governmentnotes2,197(13)2,184Foreigngovernmentbonds3284332Municipalsecurities2,20321(2)2,222Corporatedebtsecurities4,86538(18)4,885Agencyresidentialmortgage-backedsecurities3,3409(11)3,338Commercialmortgage-backedsecurities4747Marketableequitysecurity14566211Total$17,230$141$(49)$17,322Grossunrealized""DerivativeFinancialInstruments","3MonthsEndedMar.
31,2010""DerivativeFinancialInstruments","Note4.
DerivativeFinancialInstrumentsWeenterintoforeigncurrencycontractswithfinancialinstitutionstoreducetheriskthatourcashflowsandearningswillbeadverselyaffectedbyforeigncurrencyexchangeratefluctuations.
Ourprogramisnotdesignatedfortradingorspeculativepurposes.
Werecognizederivativeinstrumentsaseitherassetsorliabilitiesonthebalancesheetatfairvalue.
Werecordchangesinthefairvalue(i.
e.
,gainsorlosses)ofthederivativesintheaccompanyingConsolidatedStatementsofIncomeasinterestincomeandother,net,aspartofrevenues,ortoaccumulatedothercomprehensiveincome(AOCI)ontheaccompanyingConsolidatedBalanceSheets.
CashFlowHedgesWeuseoptionsdesignatedascashflowhedgestohedgecertainforecastedrevenuetransactionsdenominatedincurrenciesotherthantheU.
S.
dollar.
WeinitiallyreportanygainontheeffectiveportionofacashflowhedgeasacomponentofAOCIandsubsequentlyreclassifytorevenueswhenthehedgedrevenuesarerecordedorasinterestincomeandother,net,ifthehedgedtransactionbecomesprobableofnotoccurring.
AtMarch31,2010,theeffectiveportionofourcashflowhedgesbeforetaxeffectwas$185million,ofwhich$114millionisexpectedtobereclassifiedfromAOCItorevenueswithinthenext12months.
Werecognizeanygainafterahedgeisde-designatedorrelatedtoanineffectiveportionofahedgeininterestincomeandother,net,immediately.
Further,weexcludethechangeinthetimevalueoftheoptionsfromourassessmentofhedgeeffectiveness.
Werecordthepremiumpaidortimevalueofanoptionwhosestrikepriceisequaltoorgreaterthanthemarketpriceonthedateofpurchaseasanasset.
Thereafter,werecognizeanychangetothistimevalueininterestincomeandother,net.
ThenotionalprincipalofforeignexchangecontractstopurchaseU.
S.
dollarswithEuroswas1.
6billion(orapproximately$2.
2billion)and2.
4billion(orapproximately$3.
3billion)atDecember31,2009andMarch31,2010;thenotionalprincipalofforeignexchangecontractstopurchaseU.
S.
dollarswithBritishpoundswas809million(orapproximately$1.
3billion)and1.
2billion(orapproximately$1.
9billion)atDecember31,2009andMarch31,2010;andthenotionalprincipalofforeignexchangecontractstopurchaseU.
S.
dollarswithCanadiandollarswasC$306million(orapproximately$268million)andC$343million(orapproximately$309million)atDecember31,2009andMarch31,2010.
Theseforeignexchangeoptionshavematuritiesof36monthsorless.
Therewerenootherforeignexchangecontractsdesignatedascashflowhedges.
FairValueHedgesInNovember2009,webeganusingforwardcontractsdesignatedasfairvaluehedgestohedgeforeigncurrencyrisksforourinvestmentsdenominatedincurrenciesotherthantheU.
S.
dollar.
Gainsandlossesonthesecontractsarerecognizedininterestincomeandother,netalongwiththeoffsettinglossesandgainsoftherelatedhedgeditems.
Weexcludechangesinthetimevalueforforwardcontactsfromtheassessmentofhedgeeffectivenessandrecognizeth""FairValueMeasurements","3MonthsEndedMar.
31,2010""FairValueMeasurements","Note5.
FairValueMeasurementsWemeasureourcashequivalents,marketablesecurities,ARS,andforeigncurrencyderivativecontractsatfairvalue.
Fairvalueisanexitprice,representingtheamountthatwouldbereceivedtosellanassetorpaidtotransferaliabilityinanorderlytransactionbetweenmarketparticipants.
Assuch,fairvalueisamarket-basedmeasurementthatshouldbedeterminedbasedonassumptionsthatmarketparticipantswoulduseinpricinganassetoraliability.
Athree-tierfairvaluehierarchyisestablishedasabasisforconsideringsuchassumptionsandforinputsusedinthevaluationmethodologiesinmeasuringfairvalue:Level1Observableinputsthatreflectquotedprices(unadjusted)foridenticalassetsorliabilitiesinactivemarkets.
Level2Includeotherinputsthataredirectlyorindirectlyobservableinthemarketplace.
Level3Unobservableinputswhicharesupportedbylittleornomarketactivities.
Thefairvaluehierarchyalsorequiresanentitytomaximizetheuseofobservableinputsandminimizetheuseofunobservableinputswhenmeasuringfairvalue.
WeclassifyourcashequivalentsandmarketablesecuritieswithinLevel1orLevel2.
Thisisbecausewevalueourcashequivalentsandmarketablesecuritiesusingquotedmarketpricesoralternativepricingsourcesandmodelsutilizingmarketobservableinputs.
WeclassifyourinvestmentsinARSwithinLevel3becausetheyarevaluedusingvaluationtechniques(seeNote3).
Someoftheinputstothesemodelsareunobservableinthemarketandaresignificant.
WeclassifyourforeigncurrencyderivativecontractswithinLevel2asthevaluationinputsarebasedonquotedpricesandmarketobservabledataofsimilarinstruments.
Assetsandliabilitiesmeasuredatfairvalueonarecurringbasisaresummarizedbelow(inmillions):AsofDecember31,2009FairvaluemeasurementatreportingdateusingDescriptionQuotedPricesinActiveMarketsforIdenticalAssets(Level1)SignificantOtherObservableInputs(Level2)SignificantUnobservableInputs(Level3)AssetsCashequivalents:Timedeposits$3,740$$3,740$Moneymarketmutualfunds2,1532,153U.
S.
governmentagencies22Marketablesecurities:Timedeposit1,2501,250Moneymarketmutualfunds2828U.
S.
governmentagencies3,7033,703U.
S.
governmentnotes2,4922,492Foreigngovernmentbonds3737Municipalsecurities2,1302,130Corporatedebtsecurities2,8222,822Agencyresidentialmortgage-backedsecurities1,5781,578Commercialmortgage-backedsecurities4848Marketableequitysecurity199199Foreigncurrencyderivativecontracts105105Auctionratesecurities182182Total$20,469$4,844$15,443$182""PropertyandEquipment","3MonthsEndedMar.
31,2010""PropertyandEquipment","Note6.
PropertyandEquipmentPropertyandequipmentconsistofthefollowing(inmillions):AsofDecember31,2009AsofMarch31,2010(unaudited)Informationtechnologyassets$3,868$3,899Constructioninprogress1,6441,661Landandbuildings1,9071,953Leaseholdimprovements646642Furnitureandfixtures6564Total8,1308,219Lessaccumulateddepreciationandamortization3,2853,446Propertyandequipment,net$4,845$4,773""Acquisitions","3MonthsEndedMar.
31,2010""Acquisitions","Note7.
AcquisitionsInFebruary2010,wecompletedtheacquisitionofOn2Technologies,Inc.
(On2),apublicly-heldcompanyanddeveloperofvideocompressiontechnology.
Thistransactionwasaccountedforasabusinesscombination.
Thepurchasepricewas$123million,consistingoftheissuanceofapproximately174,000sharesofourClassAcommonstock(withavalueof$95million,basedontheclosingpriceofourClassAcommonstockonFebruary19,2010)andcashof$28million.
Tooffsetthedilutioneffectofissuingsharesinconnectionwiththisacquisition,wealsorepurchasedandsubsequentlyretired174,000sharesofourClassAcommonstockfor$97millionpursuanttoaRule10b5-1tradingplan.
ThefollowingtablesummarizestheallocationofthepurchasepriceforOn2(inmillions,unaudited):Goodwill$115Patentsanddevelopedtechnology27Customerrelationshipsandother2Netliabilitiesassumed(9)Deferredtaxliabilities(12)Total$123Duringthethreemonthsended,March31,2010,wealsocompletednineotheracquisitionsforatotalcashconsiderationofapproximately$145million.
Thefollowingtablesummarizestheallocationofthepurchasepriceforthenineacquisitions(inmillions,unaudited):Goodwill$107Patentsanddevelopedtechnology40Netassetsacquired6Deferredtaxliabilities(8)Total$145ForallacquisitionscompletedduringthethreemonthsendedMarch31,2010,patentsanddevelopedtechnologyhaveaweighted-averageusefullifeof3.
7yearsandcustomerrelationshipsandothershaveaweighted-averageusefullifeof2.
0years.
Goodwillexpectedtobedeductiblefortaxpurposesis$32million.
Inaddition,onNovember9,2009,wesignedadefinitiveagreementtoacquireAdMob,Inc.
,aprivately-heldmobiledisplayadstechnologyprovider,for$750millionofourClassAcommonstockandcash.
Thecompletionofthistransactionissubjecttocustomaryclosingconditions.
Weexpectthistransactiontocloseinthesecondquarterof2010.
""GoodwillandOtherIntangibleAssets","3MonthsEndedMar.
31,2010""GoodwillandOtherIntangibleAssets","Note8.
GoodwillandOtherIntangibleAssetsThechangesinthecarryingamountofgoodwillforthethreemonthsendedMarch31,2010areasfollows(inmillions,unaudited):BalanceasofDecember31,2009$4,903Goodwillacquired222Goodwilladjustment(3)BalanceasofMarch31,2010$5,122Informationregardingouracquisition-relatedintangibleassetsthatarebeingamortizedisasfollows(inmillions):AsofDecember31,2009GrossCarryingAmountAccumulatedAmortizationNetCarryingValuePatentsanddevelopedtechnology$566$380$186Customerrelationships784258526Tradenamesandother21114863Total$1,561$786$775AsofMarch31,2010GrossCarryingAmountAccumulatedAmortizationNetCarryingValue(unaudited)Patentsanddevelopedtechnology$648$405$243Customerrelationships786286500Tradenamesandother20115447Total$1,635$845$790Amortizationexpenseofacquisition-relatedintangibleassetsforthethreemonthsendedMarch31,2009and2010was$78millionand$63million.
AsofMarch31,2010,expectedamortizationexpenseforacquisition-relatedintangibleassetsforeachofthenextfiveyearsandthereafterisasfollows(inmillions,unaudited):Remainderof2010$188201120620121592013112201497201518Thereafter10$790""InterestIncomeandOther,Net","3MonthsEndedMar.
31,2010""InterestIncomeandOther,Net","Note9.
InterestIncomeandOther,NetThecomponentsofinterestincomeandother,netareasfollows(inmillions):ThreeMonthsEndedMarch31,20092010(unaudited)Interestincome$66$95Realizedgainsonmarketablesecurities,net3225Foreigncurrencyexchangelosses,net(91)(105)Other(1)3Interestincomeandother,net$6$18""ComprehensiveIncome","3MonthsEndedMar.
31,2010""ComprehensiveIncome","Note10.
ComprehensiveIncomeThechangesinthecomponentsofothercomprehensiveincomeareasfollows(inmillions):ThreeMonthsEndedMarch31,20092010(unaudited)Netincome$1,423$1,955Changeinunrealizedgainsonavailable-for-saleinvestments,netoftaxes(1)1042Changeinforeigncurrencytranslationadjustment(58)(84)Changeinunrealizedgainsoncashflowhedges,netoftaxes(2)(10)100Comprehensiveincome$1,365$2,013(1)Changeinunrealizedgainsonavailable-for-saleinvestmentsisrecordednetoftaxesof$1millionand$2millionforthethreemonthsendedMarch31,2009and2010.
(2)Changeinunrealizedgainsoncashflowhedgesisrecordednetoftaxesof$7millionand$69millionforthethreemonthsendedMarch31,2009and2010.
Thecomponentsofaccumulatedothercomprehensiveincomeareasfollows(inmillions):AsofDecember31,2009AsofMarch31,2010(unaudited)Unrealizednetgainsonavailable-for-saleinvestments,netoftaxes$13$55Foreigncurrencytranslationadjustment83(1)Unrealizedgainsoncashflowhedges,netoftaxes9109Accumulatedothercomprehensiveincome$105$163""Contingencies","3MonthsEndedMar.
31,2010""Contingencies","Note11.
ContingenciesLegalMattersCompanieshavefiledtrademarkinfringementandrelatedclaimsagainstusoverthedisplayofadsinresponsetouserqueriesthatincludetrademarkterms.
Theoutcomesoftheselawsuitshavedifferedfromjurisdictiontojurisdiction.
InMarch2010,theEuropeanCourtofJusticeissuedadecision(withrespecttothreependingcasesthatwereconsolidatedintoone)thatconfirmedthatwehavenotinfringedtrademarklawbyallowingadvertiserstobidforkeywordscorrespondingtotheircompetitorstrademarks.
Wearelitigating,orhaverecentlylitigatedsimilarissuesinothercases,intheU.
S.
,Australia,Austria,Brazil,Chile,China,France,Germany,Israel,Italy,Taiwan,andtheUnitedKingdom.
Wealsohavehadcopyrightclaimsfiledagainstusallegingthatfeaturesofcertainofourproductsandservices,includingGoogleWebSearch,GoogleNews,GoogleVideo,GoogleImageSearch,GoogleBookSearch,andYouTube,infringetheirrights.
Adverseresultsintheselawsuitsmayincludeawardsofsubstantialmonetarydamages,costlyroyaltyorlicensingagreementsororderspreventingusfromofferingcertainfunctionalities,andmayalsoresultinachangeinourbusinesspractices,whichcouldresultinalossofrevenueforusorotherwiseharmourbusiness.
Inaddition,anytimeoneofourproductsorserviceslinkstoorhostsmaterialinwhichothersallegedlyowncopyrights,wefacetheriskofbeingsuedforcopyrightinfringementorrelatedclaims.
Becausetheseproductsandservicescomprisethemajorityofourproductsandservices,ourbusinesscouldbeharmedintheeventofanadverseresultinanyoftheseclaims.
Wehavealsohadpatentlawsuitsfiledagainstusallegingthatcertainofourproductsandservices,includingAndroid,GoogleWebSearch,GoogleAdWords,GoogleAdSense,andGoogleChrome,infringepatentsheldbyothers.
Inaddition,thenumberofdemandsforlicensefeesandthedollaramountsassociatedwitheachdemandcontinuetoincrease.
Adverseresultsintheselawsuits,orourdecisiontolicensepatentsbaseduponthesedemands,mayresultinsubstantialcostsand,inthecaseofadverselitigationresults,couldpreventusfromofferingcertainfeatures,functionalities,products,orservices,whichcouldresultinalossofrevenueforusorotherwiseharmourbusiness.
Wearealsoapartytootherlitigationandsubjecttoclaimsincidenttotheordinarycourseofbusiness,includingintellectualpropertyclaims(inadditiontothetrademarkandcopyrightmattersnotedabove),governmentinvestigations,laborandemploymentclaimsandthreatenedclaims,breachofcontractclaims,tax,andothermatters.
Althoughtheresultsoflitigationandclaimscannotbepredictedwithcertainty,webelievethatthefinaloutcomeofthemattersdiscussedabovewillnothaveamaterialadverseeffectonourbusiness,consolidatedfinancialposition,resultsofoperations,orcashflows.
EPAInvestigationInFebruary2009,welearnedofaU.
S.
EnvironmentalProtectionAgency(EPA)investigationintoanallegedreleaseofrefrigerantatoneofoursma""Stockholders'Equity","3MonthsEndedMar.
31,2010""Stockholders'Equity","Note12.
StockholdersEquityThefollowingtablepresentstheweighted-averageassumptionsusedtoestimatethefairvaluesofthestockoptionsgrantedintheperiodspresented:ThreeMonthsEndedMarch31,20092010(unaudited)Risk-freeinterestrate2.
1%2.
6%Expectedvolatility40%33%Expectedlife(inyears)5.
75.
9DividendyieldWeighted-averageestimatedfairvalueofoptionsgrantedduringtheperiod$129.
49$198.
10ThefollowingtablesummarizestheactivitiesforouroptionsforthethreemonthsendedMarch31,2010:OptionsOutstandingNumberofSharesWeighted-AverageExercisePriceWeighted-AverageRemainingContractualTerm(inyears)AggregateIntrinsicValue(inmillions)(1)(unaudited)BalanceatDecember31,200912,776,488$298.
73Optionsgranted24,563$540.
03Exercised(147,057)$223.
56Canceled/forfeited(104,544)$336.
04BalanceatMarch31,201012,549,450$300.
256.
3$3,349VestedandexercisableasofMarch31,20106,076,814$267.
005.
8$1,824VestedandexercisableasofMarch31,2010andexpectedtovestthereafter(2)11,908,659$298.
576.
3$3,198(1)Theaggregateintrinsicvalueiscalculatedasthedifferencebetweentheexercisepriceoftheunderlyingawardsandtheclosingstockpriceof$567.
12ofourClassAcommonstockonMarch31,2010.
(2)Optionsexpectedtovestreflectanestimatedforfeiturerate.
Thefollowingtablesummarizesadditionalinformationregardingoutstanding,exercisableandexercisableandvestedstockoptionsatMarch31,2010:OptionsOutstandingOptionsExercisableOptionsVestedandExercisableRangeofExercisePricesNumberofSharesWeighted-AverageRemainingLife(Years)Weighted-AverageExercisePriceNumberofSharesWeighted-AverageExercisePriceNumberofSharesWeighted-AverageExercisePrice(unaudited)$0.
30$94.
80558,2543.
6$22.
44539,401$21.
37506,699$22.
37$117.
84$198.
411,021,7203.
6$177.
241,021,146$177.
241,021,146$177.
24$205.
96$298.
911,062,1634.
1$275.
111,047,983$274.
921,047,983$274.
92$300.
97$399.
008,454,8976.
9$309.
783,204,336$310.
363,204,336$310.
36$401.
78$499.
071,178,0108.
6$437.
42118,032$440.
35118,032$440.
35$500.
03$594.
05267,8034.
4$537.
02176,323$533.
80176,323$533.
80$611.
68$699.
356,5237.
1$628.
032,250$648.
792,250$648.
79$710.
84807.
7$710.
8445$710.
8445$710.
84$0.
30$710.
8412,549,4506.
3$300.
256,109,516$265.
606,076,814$267.
00Theabovetablesincludeapproximately1.
6millionwarrantsheldbyselectedfinanc""IncomeTaxes","3MonthsEndedMar.
31,2010""IncomeTaxes","Note13.
IncomeTaxesWearesubjecttoincometaxesintheU.
S.
andnumerousforeignjurisdictions.
Significantjudgmentisrequiredinevaluatingouruncertaintaxpositionsanddeterminingourprovisionforincometaxes.
OurtotalunrecognizedtaxbenefitsasofDecember31,2009andMarch31,2010were$1,188millionand$1,271million.
Also,ourtotalunrecognizedtaxbenefitsthat,ifrecognized,wouldaffectoureffectivetaxratewere$814millionand$880millionasofDecember31,2009andMarch31,2010.
Ourexistingtaxpositionswillcontinuetogenerateanincreaseinliabilitiesforunrecognizedtaxbenefits.
However,itisreasonablypossiblethatourexistingunrecognizedtaxbenefitsmaybereducedbyanamountupto$250millionwithinthenext12months,noneofwhich,willaffectourincometaxprovisionortheresultingeffectivetaxrate.
Theamountcouldvarydependingontheultimatetiming,natureofanysettlementsorexpirationofstatutesoflimitations.
""InformationaboutGeographicAreas","3MonthsEndedMar.
31,2010""InformationaboutGeographicAreas","Note14.
InformationaboutGeographicAreasOurchiefoperatingdecision-makers(i.
e.
,chiefexecutiveofficer,certainofhisdirectreports,andourfounders)reviewfinancialinformationpresentedonaconsolidatedbasis,accompaniedbydisaggregatedinformationaboutrevenuesbygeographicregionforpurposesofallocatingresourcesandevaluatingfinancialperformance.
Therearenosegmentmanagerswhoareheldaccountablebyourchiefoperatingdecision-makers,oranyoneelse,foroperations,operatingresults,andplanningforlevelsorcomponentsbelowtheconsolidatedunitlevel.
Accordingly,weconsiderourselvestobeinasinglereportingsegmentandoperatingunitstructure.
Revenuesbygeographyarebasedonthebillingaddressesoftheadvertisers.
Thefollowingtablesetsforthrevenuesandlong-livedassetsbygeographicarea(inmillions):ThreeMonthsEndedMarch31,20092010(unaudited)Revenues:UnitedStates$2,627$3,196UnitedKingdom733842Restoftheworld2,1492,737Totalrevenues$5,509$6,775AsofDecember31,2009AsofMarch31,2010(unaudited)Long-livedassets:UnitedStates$9,432$9,855International1,8981,884Totallong-livedassets$11,330$11,739"