INTERNET GIANT Google's third quarter earnings fell short of Wall Street expectations and sent the company's stock plummeting yesterday afternoon. Google's problems were compounded by a communications blunder that saw its quarterly financial results sent out early.
The company posted earnings of $2.18bn for the quarter, a 20 percent drop from this time last year. Google's recent acquisition of Motorola is taking much of the blame for the company's less than stellar third quarter.
The search giant started off the day poorly when it released a draft of its quarterly earnings report three hours early. The accidental early release caused Google share price to drop about nine per cent.
Google was eventually able to stop the bleeding by halting trading on its stock. The company withheld trading until Google executives were able to hold their third quarter earnings call with investors later in the day.
Third quarter figures showed earnings were down 20 percent, and came in at $9.03 per share. That mark fell short of the expected earnings per share price of $10.65 a share.
Much of the company's earnings troubles were focused on Google's recent acquisition of the struggling Motorola. In Google's first full quarter following the acquisition Motorola ran up an operating cost of $527m. That figure cut into 20 percent of Motorola's quarterly revenue.
However, not all was bad for Google's third quarter. During his open remarks to investors Google CEO Larry Page specifically pointed to mobile revenue as a place for optimism.
"This time last year I announced that our run-rate for mobile advertising hit $2.5bn. That seemed like a pretty big number. Even for Google," Page said.
"Now we have built up additional mobile revenue from users paying for content and apps in Google Play. Including these new sources grossed up, I can announce our new run-rate for mobile is now over $8bn. That's quite a business."
The search giant's fall from grace comes following record results on Wall Street. The company recently posted record high stock prices. Google also recently surpassed Microsoft in total market capitalisation. µ