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After Hours Action: Google

In extended trade Google tumbled almost 5% after the company's earnings sent investors running for the exits.

What must you know?

Higher expenses and the fallout from the European debt crisis dragged down profits. About one-third of the company's revenue comes from Europe, and the weaker euro meant customer payments made with the currency translated into fewer dollars than a year ago.

Meanwhile, Google is spending more to expand. The company added nearly 1,200 employees in the second quarter while the Street was expecting an increase of 800.

Despite the currency squeeze and rising expenses, Google's net income and revenue still rose at a fast clip. But the earnings growth wasn't quite as robust as analysts had hoped, a factor that seemed to amplify investor concerns that had already been weighing on Google's stock price.

Looking at the number, the Internet search and advertising giant said it earned $6.45 a share in the second quarter; analysts who follow Google expected on average for the company to report a profit of $6.51 a share.

But the report wasn't all bad. On a positive note, marketers paid more for the online ads that generate virtually all of Google's income, an encouraging sign for the overall economy. People also clicked on the ads more frequently.

What's that take away?

It was the hiring that slammed the stock after hours, says Gene Munster of Piper Jaffray. As mentioned above, the company hired 1200 people and the Street expected 800 and it triggered speculation that Google may be back to "trading like drunken sailors."

What's the trade?

I don't like Google, says Jon Najarian.

I'm a buyer on the weakness, counters Tim Seymour.


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Trader disclosure: On July 15, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour owns (AAPL), (BP), (INTC), (MSFT); Adami owns (AGU), (BTU), (NUE), (C), (GS), (INTC), (MSFT); Adami’s wife works at Merck; Terranova owns (GOOG), (AMZN), (MON), (APC), (GMCR), (MYL), (MRVL), (BAC), (ADI), (ADBE), (AKAM), (HES), (CVS), (AXP), (EMC), (ABT); Jon Najarian own (APC) short calls; Jon Najarian own (COP) short calls; Jon Najarian own (CVX) short calls; Jon Najarian own (GS) put spreads ; Kelly owns (BP) puts; Kelly is short (GS)

For Joe Terranova
Terranova works for (VRTS)
Terranova is chief market strategist of Virtus Investment Partners, LTD.
Virtus Investment Partners owns more than 1% of (CASS)
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For Brian Kelly
Accounts managed by Kanundrum Capital own (GLD)
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For Brad Hintz
The following companies are or during the past twelve (12) months were clients of Bernstein, which provided non-investment bankingsecurities related services and received compensation for such services GS / Goldman Sachs.
An affiliate of Bernstein received compensation for non-investment banking-securities related services from the following companies GS / Goldman Sachs
In the next three (3) months, Bernstein or an affiliate expects to receive or intends to seek compensation for investment banking services from GS / Goldman Sachs.
Accounts over which Bernstein and/or their affiliates exercise investment discretion own more than 1% of the outstanding common stock of the following companies GS / Goldman Sachs.

For Gene Munster
Piper Jaffray Is A Market Maker In (GOOG), (YHOO), (BIDU), (AAPL)

For Anthony Scaramucci
Scaramucci and SkyBridge Capital own (GS)

For Pavel Molchanov
**No Disclosures**

For Tom Curran
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