Google shares plummet as record revenues miss forecasts
SHARES in Google dropped more than 10pc in after hours trading on Thursday, after the web search giant reported record sales but fell short of analysts’ expectations.
The company grew its full year revenues by 29pc and saw quarterly revenues climb 27pc year-on-year to $10.58bn (£6.83bn), including $1.06bn from the UK.
However, its operating profits grew much more slowly by comparison, climbing to $2.71bn, up just 6pc from $2.54bn in the same period last year. Earnings per share were $9.50, below Wall Street’s consensus predictions of $10.49.
Chief executive Larry Page hailed 2011 as “a great year” for the company, as quarterly revenue “blew past the $10bn mark for the first time”.
He added that Google has “significantly improved velocity in execution” of its projects, and that he is “super-excited” about its growth this year.
It had stopped investing in around a dozen products and “doubled down on the really big bats,” such as its Android mobile phone operating system and Chrome web browser, he said.
The number of Google + users more than doubled in the quarter to 90m, whilst 50m Android handsets were sold during the period, growing the total number of Android handsets to 250m.
However, investors and analysts were less impressed. Shares dropped to as low as $575 after the results were released.
Hamilton Faber, an analyst at Atlantic Equities LLP in London, said: “There’s definitely some challenges from Europe. Europe seems to be the one area that’s a little bit tricky.”