New From Google Labs: Google Layoffs?
As result of the continued disruptions in the global financial markets, worldwide economic conditions and their impact on levels of consumer spending have recently deteriorated in many countries and regions. Any decreases in or delays in advertising spending due to general economic conditions could reduce our revenues or negatively impact our ability to grow our revenues.”
If Global Equities Research analyst Trip Chowdhry is right, Google’s (GOOG) latest 10-Q is more prophecy than financial guidance, more foreknowledge than forecasting.
In a dismal research note issued this week, Chowdhry suggests Google is headed for a two-year revenue contraction, one that could force the company to sack as much as 15 percent of its staff. “Our research indicates that the challenging macro-economic conditions continue to worsen Google’s advertisement driven Consumer Internet business,” Chowdhry writes. “Contacts tell us that Google is benefiting from the shift in ads from traditional media to digital media, however this shift is not sufficient to overcome the downward macro-economic pressures. Contacts also tell us that online users are selectively tuning off the right side of search results, which are sponsored links. This may reduced the number of paid clicks, which in turn may negatively impact Google’s revenues.”
An ugly prediction, but certainly, and sadly, plausible.
Hard to believe. GOOG was trading at over $700 less than a year ago. Today it closed at $275.11.