Google Suspends Trading After Financial Printer Releases Earning Report Without Authorization
It seems financial printer RR Donnelley made one hell of mistake earlier today, causing Google’s stock to drop 9% before Google was able to halt trading. What did they do? They filed an early draft of Google’s earnings without authorization.
“Earlier this morning RR Donnelley, the financial printer, informed us that they had filed our draft 8K earnings statement without authorisation.
“We have ceased trading on Nasdaq while we work to finalise the document. Once it’s finalised we will release our earnings, resume trading on Nasdaq and hold our earnings call as normal at 1:30 PST.”
If you take a look at the filing with the Securities and Exchange Commission, you can clearly see that it was not approved as it begins with an all caps “PENDING LARRY QUOTE.”
This boo-boo managed to bring Google’s stock to below that of Microsoft (who they recently savored surpassing). While the mistake shouldn’t have happened, it’s really the poor earnings report that caused traders to bail on the stock.
According to the report, Google’s profits were down 20% thanks to increased cost (which skyrocketed 71%) and lower advertising prices (increased mobile adverts, which cost less). Google’s third-quarter profits were well below analysts expectations and came in at $2.18 billion, or $6.53 a share, down from $2.73 billion, or $8.33 a share, a year earlier.
On the up side, net revenue increased to $11.3 billion from $7.5 billion while their recent Motorola acquisition brought in $2.58 billion in revenue.
The numbers are what they are and we’ll be hearing more about them in a couple hours when Google holds its earnings call. Do these numbers paint a picture of a company on a downward spiral? Sure looks that way, but I’m not putting too much stock (pun intended) into these latest numbers, as I expect a full recovery as Google sorts things out.