Oct. 15, 2009, 5:06 p.m. EDT · Recommend · Post:
Google, the penny pincher emerges
Commentary: Cash pile building up, are deals far behind?
Google shores up cash through pinching pennies
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By MarketWatch
SAN FRANCISCO (MarketWatch) -- Google Inc. made investors happy on Thursday with its better-than-expected earnings and revenue, but one of the most striking things about its results was evidence of recent penny pinching at the Internet search giant.
Apparently, Google /quotes/comstock/15*!goog/quotes/nls/goog (GOOG 546.00, +16.09, +3.04%) executives are finally listening to Wall Street, which had been concerned about its free-spending ways. In the quarter, Google said its operating expenses of $1.64 billion were 28% of revenue, down from the year-ago operating expense level of 31% of revenue, or $1.72 billion. See full story.
The company also said its total worldwide workforce shrunk by 121 people in the quarter. It employed 19,665 full-time employees at the end of September, down from 19,786 in the second quarter. Google's over exuberant hiring had been sticking in Wall Street's craw.
As it saves more money from operations, its cash pile keeps growing as its business throws off big bundles of green. Google ended the quarter with nearly $22 billion in cash and marketable securities, up from $19.3 billion in the prior quarter. With a cash pile growing at yet another tech giant, could Google start looking around for some other big acquisitions too?
If so, let's hope it finds a revenue-generating company that is more profitable than YouTube.
- Therese Poletti
from MarketWatch
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