[IceBreaker]

Google Earns $372.2M in 4Q, Misses Views
Jan 31 4:42 PM US/Eastern
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http://www.breitbart.com/news/2006/01/31/D8FFTJE80.html
By MICHAEL LIEDTKE
AP Business Writer


SAN FRANCISCO


Google Inc.'s fourth-quarter profit nearly doubled, but fell well below the high expectations for the online search engine leader.

The Mountain View, Calif-based company said Tuesday that it earned $372.2 million, or $1.22 per share, for the final three months of That represented an 82 percent increase from net income of $204.1 million, or 71 cents per share, in the previous year.

If not for a donation to launch its charitable foundation and stock compensation expenses, Google said it would have earned $1.54 per share. That missed the average estimate of $1.76 per share among 31 analysts surveyed by Thomson Financial.

Google released its results after the stock market closed Tuesday. Company shares plunged $59.16 _ 13.7 percent _ in after-hours trading after gaining $5.84 to close at $432.66 Tuesday on the Nasdaq Stock Market. At one point, the stock was down more than 19 percent in late trade.

Revenue for the period totaled $1.92 billion, an 86 percent increase from $1.03 billion in the prior year. After subtracting commissions paid to Google's advertising partners, the company registered fourth- quarter revenue of $1.29 billion, matching analyst expectations, according to Thomson Financial.

A much higher tax rate during the fourth quarter appeared to contributed to the earnings shortfall.

The company said its effective tax rate in the fourth quarter was nearly 42 percent, well above the roughly 30 percent rate during the second and third quarters. Google also expects its 2006 tax rate to be about 30 percent.

Investors have been fretting about Google's latest earnings report since rival Yahoo Inc. released a fourth-quarter profit that fell a penny below analyst estimates. That news, released two weeks ago, raised fears that the Internet's advertising market didn't expand as much as most people anticipated during the pivotal holiday shopping season.

The jitters surrounding Google were exacerbated after the company vowed to fight a Bush administration subpoena demanding one week's worth of search requests as the federal government seeks to revive a law designed to shield children from online pornography.

Google then provoked more angst by launching a new search engine in China that will censor some results to comply with the country's free- speech restrictions.

[Severed Hand of Skywalker]

Good, I don't find their search results so hot and the stock value is a joke. It all reminds me of the early .com boom.

[greenamp]

Google bubble busted a box of blue balloons.

[analogika]

Big brown google bubble busted a box of blue balloons riding a bicycle.

[Kerrigan]

The Google Bubble was obvious from the get-go.

The insane amount of speculation around Google contrasts deeply with reality of the situation. People talk about the new Google "religion", the way that Google will revolutionise everything, etc. This, all in the space of a couple of years. And what does Google have to show for it? They have been spending that IPO money on projects that don't earn any money: Google Print, maps, earth, talk, and so forth.

The core of Google's business is selling advertisement space. Anything beyond that is a gamble for them, and so far none of their gambles have paid off.

Google's founders know this, IMHO, and I wouldn't be surprised if they are right now just spending money for the sake of introducing "neat" products, and they plan on jumping ship when the money is all spent.

[Severed Hand of Skywalker]

I hate the fact that some of their Apps STAY in beta.

[turtle777]

Originally Posted by Severed Hand of Skywalker

I hate the fact that some of their Apps STAY in beta.

Why ? M$ should have done that all along

[PurpleGiant]

Google isn't 'just like the dot-com bubble'. Sure it appears to have products that cost money but don't make any, but they actually have a sustainable way to make money: advertising.

Advertising isn't some fantasy business model that has never been tried, Google is using the internet for standard business practices and winning at it. Sure their stock will fluctuate, but it is not going to 'pop' any time soon.

[Kerrigan]

That's true Purple Giant. I always considered it a bubble because of the massive hype, however like you said it still has something at its core. I suppose in this regards, Google is a lot like Apple: interminably vulnerable to competition from MS.

[NYCFarmboy]

purple, just thow many shares do you own?


google lost it when they started censoring out websites from their search engine that displeased Chinese Communists.

Google had...HAD the glint of something new and bright, now its just another search engine based on adversiting profits. For that simple fact, it's market capitalization is beyond absurd.. I guess its down 20% in value tonight, it has a LONG way to go down.

[Kerrigan]

20%?? That's some serious loss. bleck

[rickey939]

End of the world is near.

[turtle777]

Originally Posted by rickey939

End of the world is near.

... and I feel fine *dubidu lalala*

[Severed Hand of Skywalker]

http://biz.yahoo.com/rb/060131/google_earns.html?.v=3

[TailsToo]

It's like amazon... it'll be an ok stock, but it is way overvalued now.

The stock may burst, but the advertising makes all of its money is a pretty sound model, they just need to deal with click fraud.

[NYCFarmboy]

Originally Posted by Nick

The stock may burst, but the advertising makes all of its money is a pretty sound model, they just need to deal with click fraud.

they say that about 65% of the click thru ad generation billed by Google to websites are false clicks, apparently it is rampant the degree to which webmasters have figured out how to rig the google ad system...........now, how much of that is factored to Google's ad rates already though?

[turtle777]

Originally Posted by NYCFarmboy

now, how much of that is factored to Google's ad rates already though?

That's actually a good question.
This would also mean, anyone NOT cheating the system is really farked.

Originally Posted by NYCFarmboy

they say that about 65% of the click thru ad generation billed by Google to websites are false clicks, apparently it is rampant the degree to which webmasters have figured out how to rig the google ad system...........now, how much of that is factored to Google's ad rates already though?

Well, if that's the case it's good news really. That means more money will go to the honest publishers like us when the sploggers/scam artists are out of the picture.

[Kevin]

Originally Posted by Severed Hand of Skywalker

Good, I don't find their search results so hot and the stock value is a joke. It all reminds me of the early .com boom.

Still can't get that code up to par eh?