Around the Net
The Word On Google Q3 Earnings
- ZDNet, Thursday, October 13, 2011 12 AM
In the run-up to Google’s third-quarter earnings later today, analysts are expressing concerns about the Motorola Mobility acquisition, as well as increasing competition from Facebook. “When Google announces its third-quarter earnings on Thursday it faces two large questions,” writes ZDNet. “First, Google can provide insight to the broader economy based on what industries are advertising. And the second item revolves around integrating Motorola Mobility, the hit on profit margins and distractions.”
The Motorola Mobility acquisition isn’t expected to be completed for months, but, partly as a result of the deal, Piper Jaffray analyst Gene Munster expects operating margins for 2012 to fall from 46% to the low 30% range. “Welcome to the hardware business Google,” ZDNet jokes.
Added Munster: “We believe the Street focus has shifted to answering the question of ‘What happens to Google if there is a recession?’ If the economy again slows, as we saw in 2008, Google is not immune and it is likely Street estimates would need to be reduced.”
