Google's miss is still a outpacing its Internet rivals
Google stock is going to take a hit today because they didn't exceed analyst estimates yesterday with their quarterly earnings. Given that I just wrote a positive piece about Google being the barometer of the Internet yesterday, I thought I would just briefing comment on what has changed in my thinking after the earnings announcement:
Nothing. Not a thing. If anything, Google is getting to be even more influential, not less.
Let's start with the earnings report. Analyst estimate consensus was that Google would earn $3.59 a share. The company "only" earned $3.56, excluding exceptional items. Revenue growth was "only" 58%, instead of the 60% that analysts were expecting. Earnings grew 28% as well.
Now that may sound like a miss -- until you compare it with other online companies. For example, Microsoft reported its quarterly earnings yesterday, and it's online business grew 19%. And in the process, it didn't earn any money -- in fact, it lost $239 million on revenues of $688 million. That's a nice hobby, but not anything that compares to Google's business.
A more fair comparison might be to Yahoo. They reported earnings this week too, and their revenue grew 2%, while their earnings declined 2% in the process. Again, they don't hold a candle to Google's results.
Bottom line: Even though Google's stock is down 6% today, don't be fooled by not meeting analyst expectations. Google doesn't provide quarterly guidance because they want the freedom to do whatever it takes to build their business. And even with this so-called miss, Google is outrunning and outgunning its competitors in leading the Internet economy.
Nothing. Not a thing. If anything, Google is getting to be even more influential, not less.
Let's start with the earnings report. Analyst estimate consensus was that Google would earn $3.59 a share. The company "only" earned $3.56, excluding exceptional items. Revenue growth was "only" 58%, instead of the 60% that analysts were expecting. Earnings grew 28% as well.
Now that may sound like a miss -- until you compare it with other online companies. For example, Microsoft reported its quarterly earnings yesterday, and it's online business grew 19%. And in the process, it didn't earn any money -- in fact, it lost $239 million on revenues of $688 million. That's a nice hobby, but not anything that compares to Google's business.
A more fair comparison might be to Yahoo. They reported earnings this week too, and their revenue grew 2%, while their earnings declined 2% in the process. Again, they don't hold a candle to Google's results.
Bottom line: Even though Google's stock is down 6% today, don't be fooled by not meeting analyst expectations. Google doesn't provide quarterly guidance because they want the freedom to do whatever it takes to build their business. And even with this so-called miss, Google is outrunning and outgunning its competitors in leading the Internet economy.
Technorati Tags: Analysis, Financial analysis, Google, Internet, Microsoft, Yahoo
posted by Carl Howe at
10:36 AM
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