The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Google missed on revenue and missed on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly, and earnings per share improved.
Margins dropped across the board.
Google booked revenue of $10.6 billion. The 25 analysts polled by S&P Capital IQ looked for a top line of $10.9 billion. Sales were 25% higher than the prior-year quarter's $8.4 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $9.50. The 33 earnings estimates compiled by S&P Capital IQ predicted $10.48 per share on the same basis. GAAP EPS of $8.22 for Q4 were 5.3% higher than the prior-year quarter's $7.81 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 65.0%, 10 basis points worse than the prior-year quarter. Operating margin was 33.1%, 220 basis points worse than the prior-year quarter. Net margin was 25.6%, 450 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $10.7 billion. On the bottom line, the average EPS estimate is $10.11.
Next year's average estimate for revenue is $46.0 billion. The average EPS estimate is $43.85.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 14,847 members out of 17,316 rating the stock outperform, and 2,471 members rating it underperform. Among 3,563 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 3,215 give Google a green thumbs-up, and 348 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Google is outperform, with an average price target of $731.19.
New technology paradigms and mobile devices are driving the next wave of Internet services. Many older companies won't survive the change, while fortunes will be made by the first movers in the field. Where does Google fit in? What's the fortune-making change? Check out our latest free report: "The Two Words Bill Gates Doesn't Want You to Hear..." Click here for instant access to this free report.
- Add Google to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Google. Motley Fool newsletter services have recommended buying shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.