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November 18, 2004
Google sees slower growth
Google warns that increased competition could see revenue gains at a slower pace in the fourth quarter.
Search engine Google has seen share prices more than double since its August initial public offering, said in a filing with the Securities and Exchange Commission that while it believes revenue will continue to grow, the growth rate will not keep accelerating as it has been.
Google's lost $5.50, or about 3 percent, to $167 in pre-market trading on Inet following the filing.
"Our revenue growth rate has generally declined, and we expect it will continue to do so as a result of increasing competition and the inevitable decline in growth rates as our revenues increase to higher levels," said the company's filing.
"Consequently, we believe that our revenue growth rate from the second quarter to the third quarter of 2004 may not be sustainable into the fourth quarter of this year and in future periods. "
The company's filing also said it was offering to repurchase 23.4 million shares of stocks that had been held by current and former employees and contractors, as well as 5.2 million unexercised options.
That share repurchase offer is more than the 19.6 million shares it sold in its IPO. At current market prices the company will not have to repurchase any of the shares, since its offering only the price paid for the shares, between 30 cents and $80 a share.
But the offer stays open through December, so if the shares were to have a sharp fall in the next six weeks, the company could face some additional share repurchases.
Source: CNNfn.com