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SAN FRANCISCO - Google has reported a lower-than-expected quarterly profit and predicted further spending to shore up its operations, sending its shares down as much as 9.5 per cent.
The world's top internet company said it expected to continue to make "significant capital expenditures" after spending US$678 million ($871.5 million) in the fourth quarter on data centres, servers and other equipment.
Wall Street is also keen to see how a US economic slowdown will hit Google, which generates nearly all of its revenue from advertising.
Clayton Moran of Stanford Group said the results were disappointing given the Web search leader's track record of beating expectations.
"There was a slight softness in revenue which perhaps portends softness going forward due to the ... US economy," he said.
Fourth-quarter net income rose to US$1.21 billion, or US$3.79 per diluted share, from US$1.03 billion, or US$3.29 per diluted share, in the year-earlier quarter. Excluding special items, earnings per share amounted to US$4.43, falling short of analysts' average forecast of US$4.47, according to Reuters Estimates.
Revenue rose 51 per cent to US$4.827 billion. Analysts, on average, had predicted revenue of US$4.83 billion, with estimates ranging from US$4.67 billion to US$5.10 billion.
Google shares traded at US$522.54 in extended trading, down from their Nasdaq close of $564.30.
- REUTERS
