Google Climb Put on Hold

Updated 6:45 p.m. EDT

There's just no pleasing some investors. Google(GOOG Quote) posted second-quarter financials that showed revenue nearly doubling and a net profit that rose fourfold, yet the stock dropped in after-hours trading.

After reaching a record high of $317.80 Thursday morning, Google closed at $313.94, its highest close ever. But after the company's earnings report right after the market closed, the stock was down nearly 6%, falling below the hallowed $300 level.

There were two possible reasons for the sudden drop. On its conference call, CEO Eric Schmidt and CFO George Reyes both made clear that Google's third-quarter report may not be so hot. Not only is the third quarter a seasonally slow one for Internet surfing and ad spending, but Google's third quarter of 2004 was exceptionally strong because of improvements it made to its search algorithms and because the hype surrounding its planned IPO drew new users to its site. ...