This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Google Shares Down On Mixed Results

Stocks in this article: GOOG

NEW YORK ( TheStreet) -- Highlighting a turning point that the world's largest search company has reached, Google (GOOG) posted mixed first-quarter earnings Thursday after the bell.

While quarterly sales came in well above estimates -- $6.5 billion (excluding traffic acquisition costs, or TAC) vs. $6.3 billion -- profits, which actually rose about 17%, fell short of what analysts wanted to see. Google posted adjusted earnings of $8.08 per share, two cents less than what analysts were calling for.

Tacking on TAC -- the money Google pays affiliates to bring traffic to its network -- the company reported sales of $8.58 billion, representing almost 30% increase over the prior year's quarter.

"We had a great quarter with 27% year-over-year revenue growth," said Patrick Pichette, Google's chief financial officer, in a prepared statement. "These results demonstrate the value of search and search ads to our users and customers, as well as the extraordinary potential of areas like display and mobile. It's clear that our past investments have been crucial to our success today -- which is why we continue to invest for the long term."

The key to Pichette's statement is the bit about long-term investment. Google, which still dominates the search market, has failed to excite investors over the past few years. Despite two quarters of solid earnings beats, the stock is down nearly 7% over the past six months, and has fallen almost 3% so far in 2011.

While co-founder Larry Page taking over the CEO role last month telegraphs a sharper focus on innovation and a less bureaucratic operation, near-term profits could suffer as the company looks to expand in new directions. Also, Google's heavy commitment to hiring -- which should help it combat the engineering brain drain from Google to younger Valley rivals like Facebook -- will weigh heavily on margins, analysts have said.

Google reported that it hired about 1,900 employees worldwide during the first quarter.

Another profit-helping boost: Google reported that both paid-per-clicks and cost-per-clicks rose -- the amount that ad partners pay per click -- 18% and 8%, respectively.

New CEO Larry Page made his debut on the company's first-quarter conference call, which TheStreet is live-blogging.

Google shares were dropping more than 5% in after-hours trading Thursday with volume already at nearly 1.6 million, according to

-- Written by Maggie Overfelt in New York.

>To follow the writer on Twitter, go to

>To submit a news tip, send an email to:

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,787.20 +9.05 0.05%
S&P 500 2,067.13 +5.90 0.29%
NASDAQ 4,757.1030 +8.7070 0.18%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs