Google has disappointed the markets for the last two quarters, coming in below expectations. This time, Wall Street was hoping for revenue of $14.80 billion and earnings per share of $10.34. Google bested that with $14.98 billion in revenue and earnings of $10.47 per share.

The company's share of the search market has remained relatively flat and its margins on desktop search advertising — Google's bread and butter — have declined as PCs are replaced by smartphones and tablets. Last quarter its cost per click, a metric of how much brands pay to advertise with Google, declined 6 percent. It fell again this quarter, down 8 percent year of year and 4 percent from last quarter. But the total volume of paid clicks (when people click on ads across Google's sites and on ad networks it serves) rose 26 percent year over year, offsetting that decline.

Revenues at Motorola continued to fall

As Colin W. Gillis, a technology analyst at BGC, pointed out in Time this morning, Google has seen a substantial deceleration from the 35 percent annual growth that the company delivered as recently as 2011, averaging around 20 percent in its last several quarters. "We see the slowing core business as a one reason why Google is investing so heavily in new ventures as new products are needed to reignite revenue growth," says Gillis.

Revenue at Motorola Mobility, which has been a drag on Google's bottom line since acquiring the company last year, continued to fall, dropping $600 million since this time in 2012. Losses from the unit also grew to $248 million, a 24 percent increase of the same time last year. When asked about this increasing burn rate during the earnings call, Google replied it was still early days, said it was encouraged by the reception for the Moto X, and said it would continue building out marketing and distribution for Motorola over the coming years.

CEO Larry Page specifically mentioned smartwatches as an exciting opportunity on the earnings call. He says he used to feel guilty when visiting the Android team, because it wasn't part of Google's core business; now it's at the heart of what the company does. Page also mentions television, noting how Chromecast has emerged as a best seller. He also says that 40 percent of YouTube traffic is now from mobile, up from 25 percent last year.

Page's voice sounded shaky and weak

As in previous calls, Page's voice sounded shaky and weak today. He wrapped by stating that he won't be attending future earnings calls, saying he needs to prioritize his time for the good of the business. It's easy to imagine that investors might react negatively to the news; GOOG is up over 7.5 percent in after-hours trading, though, so early signs are positive.