Last year, investors wondered when Google would be a $1000 stock. Ahead of earnings Thursday, they’re trying to determine if it will remain north of $300.
Google ended 2008 with the most sobering quarter in its 10-year history, and there's little reason to believe the upcoming report will bring much joy to the once high-flying company.
Although the search giant sailed through the first half of last year, it has struggled in recent months as more advertisers curtail their spending amid the recession. Furthermore, consumers have scaled back their online shopping — a troubling trend for Google because clicking on ads accounts for most of the company's revenue.
In a sign management expects its revenue to remain relatively flat or perhaps even erode for the first time in Google's history, the company has been cutting costs. Google already has acknowledged jettisoning a significant number of its 10,000 contractors, although it has declined to say how many. In the past week, the company also disclosed it laid off 100 of its own workers.
The purge represents just a sliver of a payroll spanning 20,100 employees, but it marks a milestone in the company's maturation. Management had never previously dumped workers except to eliminate overlapping positions following an acquisition.