Google’s Earnings Get Out Early, Revenue and CPCs Fall – Again, Stock Plummets 10 Percent

 

google stock chart 6 months ended october 18 2012

Google’s Earnings Get Out Early, Revenue and CPCs Fall – Again, Stock Plummets 10 Percent:

We knew this would happen.

Google’s earnings came out early, way before the company expected and investors didn’t like what they saw. Google is a widely held stock and the earnings news was considered awful by analysts.  Google’s earnings and revenue were down and the stock market reacted exceptionally negatively bringing it down significantly today.

Look at the chart above which shows how badly the market reacted to Google’s earnings news. Google’s shares moved down around $80 dollars from $760 to below $680.  The company’s 2012 third-quarter earnings were released early due to a mistake by its financial printer and the stock was pummeled by nearly 10 percent in one day.

Google’s earnings were lower than analysts had predicted due to a continuation in the drop of costs per click by 15 percent which we predicted.  See – Google’s Second Quarter 2012 Profit Grows, But Advertiser Payments Per Click Still Falling, The Economy Could Be Another Reason Why and 6 Reasons Why Google’s CPCs Were Down Year Over Year by 12 Percent: Google Q1 2012 Earnings Highlights

We told our readers months ago that Google’s search was inferior to years past and it was using Google+ to change search results which is negatively impacting the authenticity of SERPs.  Panda may have also had a negative impact on Google search and the company’s profit fell 20 percent to $2.18 billion although revenue from ads were up 19 percent from the third quarter of 2011 to $11.53 billion.

We expect Google’s problems to continue because the best sites aren’t getting traffic and as we mentioned months ago – ‘google bombing’ is still possible in 2012.  Google’s lower revenue can be a problem for the whole search industry and as social media continues to expand, expect Google’s competition to grow.

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