Google beats earnings estimates, sales fall from previous quarter
"We're still basically in uncharted territory," Eric Schmidt, Google CEO, said on the company's conference call. Google is positioned to take advantage of an economic recovery, he said, while noting that the "economic environment" still "remains tough."
Schmidt wouldn't comment on Google's interest in buying Twitter, when asked on the call. He did say Twitter is "incredibly useful," and that Google would be "very happy" to help them pursue their growth strategy.
Mountain View-based Google collected first-quarter net revenue of $4.07 billion, up 6 percent from 2008's first quarter, but just under analyst consensus estimates of $4.1 billion. Earnings, excluding special items, for the first quarter were $5.16 a share, beating the $4.93 a share expected by a Thomson Reuters survey of analysts.
The results "underline both the resilience of our business model and the ongoing potential of the web as users and advertisers shift online," Schmidt said in the company's earnings statement.
Clayton Moran, analyst at the Benchmark Company, said Google had a "solid quarter, showing sustained outperformance of their market and their peer group."
He has a "buy" rating on Google's shares and doesn't own them, he said in a telephone interview from Boca Raton, Florida with DailyFinance.
Google has "been very proactive in keeping costs in check and cutting capital expenditures," Ryan Jacob, fund manager of the Jacob Internet fund said in an e-mail with DailyFinance.
Moran echoed Jacob's comments, saying Google's first quarter performance was "driven primarily by expense management," calling it a "big deal" in this economic enviornment. Investors "might not view it as sustainable," he said.
Shares of Google are up 26 percent this year through Thursday's Nasdaq Stock Market trading.
Google, which runs the most popular search engine in the world, said its paid clicks increased 17 percent compared with last year's first quarter. Its cash stood at $17.8 billion at the end of last month.
Mobile searches are increasing, Google told analysts and investors on the conference call Thursday. Google CFO Patrick Pichette said while expenses fell after labor costs were cut, the company is "still hiring in critical areas."
Anthony Massucci is a senior reporter at DailyFinance. He previously covered technology stocks at Bloomberg News.