Peter Kafka

Recent Posts by Peter Kafka

Wall Street Gives Google a Mild Thumbs Down

Was it something Larry Page said? Something he didn’t say?

We don’t know, and we should be wary of people who say they understand why the market moves in any particular direction, on any particular day. That said: The day after Google announced its Q1 earnings, Google is trading down about 4 percent. Meanwhile, the Nasdaq is down about 1 percent.

To recap: Google’s Q1 came in around where Wall Street thought it would — revenues were just under consensus, and earnings were a bit above.

The company’s cost-per-click trend continued to decline, dropping 12 percent year over year, and I’ve seen some reports where analysts are wringing their hands over that. But the stock-watchers I follow don’t seem overly concerned about that — they assume that as long as Google’s overall ad volume increases, it can afford to sell its stuff for less.

The other news item, of course, was that Google is creating a new, non-voting class of stock that effectively creates a 2-1 split. This has no bearing on the way the company does business — it will still run, effectively, as a privately controlled company whose shares happen to trade on the open market. Hard to see investors getting excited one way or another about it. But you never know.


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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik