Without saying much, CEO Eric Schmidt kicked off the call, promising that the company is pleased with its performance in the quarter and the year as a whole: “If you look at 2007, a strong financial performance across the board… I want to call out strong international growth, more than half of our search traffic is now outside of the United States.” In Q4:  “Pleased with traffic growth across the board.”

—Social ads disappoint: CFO George Reyes: Traffic acquisitions costs were up sequentially, as a percentage of revenue, from 29.1 percent to 30 percent. The reason: poor performance at certain Adsense partners, to whom Google (NSDQ: GOOG) is required to make guaranteed payments. And who were these partners? “Social networking inventory is not monetizing as well as expected.” (That sounds like it has to be MySpace.) This affected margins down the line. Another factor affecting revenue was a change in ads resulting in fewer accidental clicks, but better ROI for advertisers.

—Sergey Brin: Ticking off some new initiatives: YouTube presidential debates—claims nearly as many viewers via YouTube as CNN, GMail interoperability, Google Maps on mobile. “We’ve got a lot of increased trial and adoption of Google Apps.” The company will deploy Google Apps at Genentech, as well as a number of universities.

Q&A: (Staci picks up from here.)

—YouTube ads: Doing a lot of experimentation, trying a lot of things. Page emphasized about growth. Schmidt’s re-framing: In the case of YouTube, there’s a huge scale opportunity. “It should become very significant; exactly when is difficult to predict.”

—UK weakness: Attributed to finance and travel. Won’t say whether they are picking up yet this quarter.

—Macroeconomics: Brin says their studies don’t show a real effect. Jonathan Rosenberg said there may be some but Google might also benefit from added clicks produced by cost-cut conscious consumers increasing comparison shopping. Schmidt adds later: “I’m happy to say that we have not yet seen any negative impact from the rumors of future recessions.”

—700 MHz auction: Schmidt says they decided in advance not to answer any questions, even something vague about WiMax, because of the auction rules.

—DoubleClick: Schmidt: “We had FTC clearance in December ... working with the European Commission and obviously very hopeful will clear as well.” He returned to it briefly: “The display business is right in front of us. The DoubleClick acquisition is a central part of that.”

—Healthcare: Nothing to announce today.

—Social ads: A recurring theme with Brin responding several times. The gist: Between MySpace, Google’s own Orkut, and what Brin said are probably about 20 others, there’s “an incredible amount of this inventory” we’re experimenting with but haven’t yet solved. Brin: “I don’t think we have the killer best way to advertise and monetize social networks yet. We’re running lots of experiments. We had some significant improvements but ... some of the things we were working on in Q4 didn’t really pan out and there were some disappointments there.”

—Social networks: Page talks about how excited they are about Open Social and various efforts in social networks.:  “We are really excited about all the progress and innovation there ... even though Q4 for us was a little bit of a disappointment in terms of the kinds of improvements in monetization we were able to generate, Q3 was fine for us in that light, as was Q2 and we are optimistic about the future.” Schmidt jumps in: “Remember that the Google model is one of experimentation. We keep trying and we keep trying new ideas until we find the ones that really generate phenomenal ROI—and not only do we go with them, but they grow very quickly.”

Listen to the call or check out the transcript at SeekingAlpha.com for more.