Google shares dip as earnings fall short
NEW YORK– Google shares dipped sharply in after-hours trading on Thursday after the Internet search giant’s quarterly earnings fell short of the expectations of Wall Street analysts.
The Mountain View, California-based company reported a fourth-quarter net profit of $2.71 billion compared to $2.54 billion in the same quarter a year ago.
Revenue rose 25 percent to $10.58 billion but was $8.13 billion when including traffic acquisition costs — the portion of revenue shared with Google’s partners — less than the $8.4 billion expected by analysts.
Earnings per share of $9.50 were below analyst forecasts of $10.49.
Google shares were down 9.12 percent at $581.25 in after-hours trading after gaining 1.05 percent during the day on Wall Street.
Investors are used to Google matching or surpassing analyst forecasts and its shares tend to suffer when the company fails to meet the always lofty expectations.
Chief executive Larry Page said Google had a “really strong quarter ending a great year.
“Full year revenue was up 29 percent, and our quarterly revenue blew past the $10 billion mark for the first time,” Page said in a statement.
“I’m very excited about what we can do in 2012 — there are tremendous opportunities to help users and grow our business,” he said.
The Google chief executive also said he was “super excited about the growth of Android, Gmail, and Google+, which now has 90 million users globally — well over double what I announced just three months ago.”
In a conference call with financial analysts, Page said user engagement with Google+, the Internet titan’s Facebook rival, is “growing tremendously.”
“Plus users are very engaged with our product, over 60 percent of them engage daily and over 80 percent weekly,” he said.
Page, who took over as chief executive from Eric Schmidt in April of last year, said growth of the Android software platform for mobile devices was “quite simply mind-boggling.”
He said 700,000 Android-powered phones are activated every day and there are 250 million Android devices in total, up 50 million since November.
Google’s free email program Gmail has more than 350 million active users “and is growing rapidly,” Page said.
Chief financial officer Patrick Pichette said display advertising growth remained strong and revenue was rising in every region despite the crisis in Europe.
Google said it had 32,467 full-time employees at the end of December, up from 31,353 at the end of September.