Business Technology

Wednesday 13 December 2017

Mistake costs Google €16.8bn in minutes

When trading was quickly stopped it was slightly better at 9pc down or $687.30 per share.
When trading was quickly stopped it was slightly better at 9pc down or $687.30 per share.
The early release sent Google's share price plummeting and sparked a panic sell-off as the shares fell 11pc.

Peter Flanagan New Technology Correspondent

GOOGLE'S shares crashed by as much as 11pc, wiping €16.8bn off the web search company's value, after its results were inadvertently published before the stock markets had closed, revealing a 20pc fall in profits.

The internet giant was expected to release its third-quarter results after the market closed in New York, but they were accidentally released early with the partially written statement showing a gap for a quote from Google's chief executive, Larry Page.

The early release sent Google's share price plummeting and sparked a panic sell-off as the shares fell 11pc.

When trading was quickly stopped it was slightly better at 9pc down or $687.30 per share.

Blamed

Google blamed its financial printer, RR Donnelly, for the unfinalised release. It asked Nasdaq to halt trading in its stock while it worked to "finalise the document".

The results showed revenues of $11.3bn in the third quarter, but these fell short of analyst estimates of $11.8bn, while profits tumbled to $2.18bn, down a fifth on the $2.73bn it made in the third quarter last year.

Google also revealed a worrying drop in the amount of money it receives for each advert users click on its websites.

Its average income per click fell 15pc over the three months to the end of September, sparking fears that it is losing traction with advertisers and failing to monetise internet usage on mobiles as efficiently as it has done on traditional personal computers.

The search engine company also revealed in the filings that it plans to make significant capital expenditure, reviving concerns regarding the amount of money it is spending on expanding its operation and hiring staff around the world.

The company's total costs shot up by 71pc, despite commitments to cut staff in some of its divisions.

Google said in August that it will axe about a fifth of the workforce at Motorola Mobility.

Yesterday's blow to investor confidence in Google is the second piece of bad news it has received in as many days.

On Tuesday, the European regulators ordered the web search company to become much more transparent about how it uses people's information, amid fears that it could be breaching privacy laws.

The regulators have told Google to offer users a way of opting out of some of its most invasive methods for collecting and using data.

Irish Independent

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