Google Fans Fidget

While Google(GOOG Quote - Cramer on GOOG - Stock Picks) again breezed by Wall Street's earnings estimates and topped revenue expectations, the company's solid performance didn't seem to keep par with the upward spiraling expectations set for it.

On Wednesday, Google reported earnings of $3.18 a share on an adjusted basis, well ahead of the $2.92 consensus for analysts surveyed by Thomson First Call. Revenue came in at $2.23 billion, ahead of the $2.19 billion that analysts had predicted.

Curbing that revenue figure was Google's aggressive promotion of its Checkout online payment service during the holiday season, which UBS analyst Ben Schachter estimates amounted to about $30 million. UBS makes a market in Google shares.

A major new push for Google that was launched in 2006, Checkout extends the company's reach into e-commerce and capitalizes on its dominance as the start destination for a growing number of web searches, even as it makes Google's ad platform more appealing to merchants.

Google's solid performance for its fourth quarter mirrored the impressive numbers it posted in the third quarter that preceded it. The company beat analyst expectations by 8% during the third quarter, compared with 8.9% for the fourth quarter.

And were it not for the discounts offered to promote Checkout, the company would have exceeded revenue expectations by virtually the same amount in the third quarter as it did in the fourth. Revenue came in 3.3% ahead of consensus in the third quarter, compared with 3.2% for the fourth quarter, excluding the Checkout promotion.

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