Even though shift from desktop computers to smartphones has curbed Google's pricing power in the digital market, Olson believes the Mountain View, California, company is likely to regain some of the clout as the mobile market evolves.Īlthough he didn't participate in Thursday's conference call, Page has made it clear through the years that he isn't interesting in pursuing strategies designed to increase earnings from one quarter to next or provide a short-term lift to Google's stock price. Paying a dividend also is frequently done by companies that have run out of growth opportunities, Olson said, and that isn't the case with Google. He interpreted Pichette's comments as a 'false signal.' 'From an investment perspective, we'll continue to seek a healthy balance between growth and discipline and the willingness to throttle back when we reach the limits of what we believe we can manageably absorb,' Pichette said.Įdward Jones analyst Josh Olson doubts Google is going to start paying dividends or buying bushels of its own stock anytime soon. Investors also may have drawn hope from Pichette's pledge to spend in a 'prudent manner,' even after a year that saw Google pour billions into hiring nearly 10,000 more employees and a wide range of projects that include self-driving cars, Internet-connected eyewear, Internet-beaming balloons, robotics, satellites and biotechnology. About 60 percent, or $38 billion, of Google's cash is held outside of the U.S., Pichette said.Īlthough no commitments were made, those remarks seemed to be enough to reverse an initial sell-off in Google's stock following the disappointing earnings report.Īfter shedding 2 percent in the first hour of extended trading, the shares rebounded to post a 1 percent gain of $6.27 to $519.50. companies to bring back money held in overseas accounts at lower tax rates. He indicated Google would be more likely to do so if laws are changed to allow U.S. Pichette didn't rule out the possibility of returning some of Google's $64 billion in cash to shareholders when asked about it Thursday. 'Share price does matter,' Patrick Pichette, Google's chief financial officer, said in a Thursday conference call. Company stock is part of their pay package, so employee morale could suffer if Google's stock remains in a funk. Google certainly has an incentive to do something, if for no other reason than to keep its 53,600 workers happy. That strategy has worked well for another technology leader, Apple Inc., whose own shares have surged by nearly 60 percent since the iPhone maker announced a higher dividend and increased stock buybacks nine months ago. Page believes the company needs to continue taking risks and making big bets on ambitious ideas to open future moneymaking opportunities while striving to make the world a better place.Īnother way would be for Google to start paying a quarterly dividend for the first time in its 10-year history as a public company, or to pour money into buying back its own stock. One way to lift the stock would be to slash expenses to boost earnings, something that Google CEO Larry Page doesn't seem particularly interested in doing. The Standard & Poor's 500 index has climbed by 9 percent during the same stretch. That discouraging trend is one reason Google's stock price ended Thursday's trading session 8 percent below where it stood 13 months ago. The earnings released late Thursday missed analyst targets, marking the fifth consecutive quarter that has happened. Those factors have left some investors wondering what Google might do to boost its stock price, especially after the company's latest financial report.

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