Google Reports Early: Huge Miss Sends Stock Plunging

Tyler Durden's picture

Google is down over 8% as it reported earnings early and surprised to the downside...

  • GOOGLE 3Q REV. EX TAC $11.33B, EST. $11.83B           
  • GOOGLE 3Q ADJ. EPS $9.03, EST. $10.65
  • Q3 REVENUE EX-TAC $11.33 BLN VS EXP. $11.83 BN
  • Q3 NETWORK REVENUE USD 3.13 BLN

Highlights from the Edgar-filed 8K (more here):

  • GAAP operating income in the third quarter of 2012 was $2.74 billion, or 19% of revenues. This compares to GAAP operating income of $3.06 billion, or 31% of revenues, in the third quarter of 2011. Non-GAAP operating income in the third quarter of 2012 was $3.80 billion, or 27% of revenues. This compares to non-GAAP operating income of $3.63 billion, or 37% of revenues, in the third quarter of 2011.
  • GAAP net income in the third quarter of 2012 was $2.18 billion, compared to $2.73 billion in the third quarter of 2011. Non-GAAP net income in the third quarter of 2012 was $3.01 billion, compared to $3.18 billion in the third quarter of 2011.
  • GAAP EPS in the third quarter of 2012 was $6.53 on 333 million diluted shares outstanding, compared to $8.33 in the third quarter of 2011 on 327 million diluted shares outstanding. Non-GAAP EPS in the third quarter of 2012 was $9.03, compared to $9.72 in the third quarter of 2011.
  • Non-GAAP operating income and non-GAAP operating margin exclude stock-based compensation (SBC) expense, as well as restructuring and related charges recorded in our Motorola business. Non-GAAP net income and non-GAAP EPS exclude the expenses noted above, net of the related tax benefits. In the third quarter of 2012, the expense related to SBC and the related tax benefits were $715 million and $155 million compared to $571 million and $116 million in the third quarter of 2011. In the third quarter of 2012, restructuring and related charges recorded in our Motorola business were $349 million, and the related tax benefits were $76 million.
  • Google Revenues (advertising and other) – Google revenues were $11.53 billion, or 82% of consolidated revenues, in the third quarter of 2012, representing a 19% increase over third quarter 2011 revenues of $9.72 billion.
    • Google Sites Revenues – Google-owned sites generated revenues of $7.73 billion, or 67% of total Google revenues, in the third quarter of 2012. This represents a 15% increase over third quarter 2011 Google sites revenues of $6.74 billion.
    • Google Network Revenues – Google’s partner sites generated revenues of $3.13 billion, or 27% of total Google revenues, in the third quarter of 2012. This represents a 21% increase from third quarter 2011 Google network revenues of $2.60 billion.
  • Google International Revenues – Google revenues from outside of the United States totaled $6.11 billion, representing 53% of total Google revenues in the third quarter of 2012, compared to 54% in the second quarter of 2012 and 55% in the third quarter of 2011.
  • Foreign Exchange Impact on Google Revenues – Excluding gains related to our foreign exchange risk management program, had foreign exchange rates remained constant from the second quarter of 2012 through the third quarter of 2012, our Google revenues in the third quarter of 2012 would have been $136 million higher. Excluding gains related to our foreign exchange risk management program, had foreign exchange rates remained constant from the third quarter of 2011 through the third quarter of 2012, our Google revenues in the third quarter of 2012 would have been $557 million higher.
    • Google revenues from the United Kingdom totaled $1.22 billion, representing 11% of Google revenues in the third quarter of 2012, compared to 11% in the third quarter of 2011.
    • In the third quarter of 2012, we recognized a benefit of $62 million to Google revenues through our foreign exchange risk management program, compared to $1 million in the third quarter of 2011.
  • Reconciliations of our non-GAAP international revenues excluding the impact of foreign exchange and hedging to GAAP international revenues are included at the end of this release.
  • Paid Clicks – Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of our Network members, increased approximately 33% over the third quarter of 2011 and increased approximately 6% over the second quarter of 2012.
  • Cost-Per-Click – Average cost-per-click, which includes clicks related to ads served on Google sites and the sites of our Network members, decreased approximately 15% over the third quarter of 2011 and decreased approximately 3% over the second quarter of 2012.
  • TAC – Traffic acquisition costs, the portion of revenues shared with Google’s partners, increased to $2.77 billion in the third quarter of 2012, compared to $2.21 billion in the third quarter of 2011. TAC as a percentage of advertising revenues was 26% in the third quarter of 2012, compared to 24% in the third quarter of 2011.

Stock in freefall:

EDGAR page showing result detail:

 

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Calidreaming's picture

Down  Down down    and take that AAPL pos with you

Stoploss's picture

Shit must be running down the legs of the faceplant boyz right about now.

vast-dom's picture

how anyone thought google was ever worth anywhere near even half of what it trades is fucking nuts. just like fuckbook and aaple....i guess it's in the air....

ghostfaceinvestah's picture

Funny how they never halt stocks that go up in price.

Stoploss's picture

Look where the problem came from M O B I L E..  Cannot be monetized..............................

LongSoupLine's picture

 

 

Those numbers can't be right...I'm gonna Google it...

SeverinSlade's picture

Serious question.

Does anyone know if Google gets a hit when someone searches using Startpage or Ixquick?

vast-dom's picture

not sure. Ixquick has a piggyback option off of google without registering your IP. so i guess if facebook fakes most of their click-throughs, then i'm certain google will count that Ixquick optional search.

seek's picture

Yes, they do, startpage is just a privacy proxy.

In the past google has blocked proxied searches when the proxy has gotten too large (ie google loses too much revenue from it.)

Skateboarder's picture

I'm more butthurt by FB's resilience in hanging around $20 and posting 11-12 cents EPS.

overbet's picture

Options market makers were frantic. Wide ass spreads nobody knew what hit them. Good work GOOG!

max2205's picture

MOTHER FUCKERS.... this is about as bullshit as it gets...fuck all you cocksuckers...I was waiting to play those spread near the close

spastic_colon's picture

Good time to replace IBM in the Dow

Death and Gravity's picture

"Google Bomb" just got a new meaning.

BeaverFever's picture

Personally I hope that Reggie the Gobble lover personally apologizes to all of his brainwashed followers as well as all as any dupes on ZH who took his nefarious advice. Gobble = NSA

CH1's picture

Actually, I think AT&T is NSA and Google is CIA, but who really knows and what's the difference?

SILVERGEDDON's picture

GREAT GOOGLIE MOOGLIES ! IT'S THE END OF THE WORLD AS WE KNOW IT ! And, I'm feeling fine..............................

SILVERGEDDON's picture

Reggie was wiped out. Off with the suit, back to the loin cloth and spear, just in time for SHTF. BANKERS. iT'S WHAT'S FOR DINNER.

El Hosel's picture

IBM,INTC........GOOOOOOOOOOOOOOOOOOOOOOOOOG!

  Bernanke going to upgrade GOOG to buy on weakness, for the good of the Ponzi.

SeverinSlade's picture

Yup, the economy is BOOMING.  Michelle Obama said so.

SeverinSlade's picture

Michelle O is racist against Aussies and Koalas.

pods's picture

But is she against Australian kissing?

You know, down under.

pods

alien-IQ's picture

Reggie Middleton please report to the emergency room, Code Blue. I repeat CODE BLUE.

I am a Man I am Forty's picture

Reggie Reggie Reggie!!!!!!  What's going on here? Your number one pick!!!!!!!!!!!!

 

WRONG AGAIN!!!

alien-IQ's picture

I have no doubt that he will somehow find a way of interpreting these numbers to conclude that he was, as always, right. After which he will surely grace us all with a Dion Sanders endzone dance...Because that's how he rolls.

I am a Man I am Forty's picture

Buried in his 1000 pages of pro google analysis of uninterpretable nonsense there will be language that there is a remote possibility of a miss due to a so in so risk factor on footnote 26 on page 645 and he will say I told you so, that I saw this coming, and this is a buying opportunity.

kliguy38's picture

This could be serious.......I think I'll convert my GOOG to AAPL

Triple A's picture

ahhhh poor search engine, i thought google was going to save the world.

jimijon's picture

Reggie... Oh Reggie...   *crickets*

Count de Money's picture

BoomBustBlog post of how Reggie saw this coming in 3, 2, 1...

lizzy36's picture

Free FALLIN

What were Lavorgna's projections ;)

If revenue is down 15% why hasn't FB hit negative numbers yet?

Cognitive Dissonance's picture

Missed it by >          that          < much!

gmak's picture

Bloomberg suggests that the press release was early through a mistake - based on placeholders for some items such as CEO's comment(s).

hotkarlandtheclevelandsteamers's picture

Reggie did you tell us your clown obama supporter. Any way you slice and dice these numbers they are steaming turds.

williambanzai7's picture

Boom or bust?

Paging Mr Middleton...

alien-IQ's picture

I'm really looking forward to hearing him try to spin this one.

Wakanda's picture

Don't scare Reg away - he's valuable as a contrarian indicator.

alien-IQ's picture

I predict he will say "I never said buy GOOG"....just like he claimed he never said "Sell AAPL"...at 480!.

 

It's gonna be fun watching him twist in the wind with this one.

ZakuKommander's picture

Quickly, Reggie! To the barricades!

monopoly's picture

Buy the Dip. LOL..JK!

 

LongSoupLine's picture

Margin calls are coming fast, Bitchez!!

 

edit: Shares halted at -9%  (but it's ok if they go up 20 sigma moves?!?!)

fuck this rigged game!

CloseToTheEdge's picture

Hey Google, Say Hello to my little friend THE EDGE...

ptoemmes's picture

Warning Will Rodgers.  Algo meltdown.  Does not compute. Dive! Dive! Dive!  Aooga, Aooga.  Dive! Dive! Dive!

monopoly's picture

So glad none of the mutual funds own GOOG. Whats that? They all OWN GOOG> Oh My!

Cult_of_Reason's picture

Bullish news! All is well! Buy the dip and hold for 5-10 years!

The stock is dirt cheap. Bernanke has your back and will buy GOOG if needed.

Trees grow to the sky. Cramer is a genius. CNBC never lies.