Google filed for its long-awaited IPO Thursday, and the company’s finances lived up to expectations: triple-digit earnings and revenue growth, high profitability, boatloads of cash, and little debt.
So why bother going public? According to the company’s SEC filing, since they have to open their books anyway, they might as well go public while they’re at it. Between statements like that and an auction-based IPO, the company is making a good start on forthright management.
Google earned $105.6 million last year on revenue of $961 million, up 6% and 176%, respectively. And therein lies the one weakness in Google’s numbers: with high growth comes high costs. Costs and expenses were up 284% last year, including a huge jump in stock-based compensation.
In the first quarter of 2004, revenues were up 118% over the first quarter of 2003 to $390 million, and net income increased 147% to $64 million. Google had $455 million in cash at the end of the quarter.
Yahoo , by contrast, earned $238 million last year on $1.6 billion in revenue. Earnings were up 122%, and revenues were up 71%. In the first quarter of this year, Yahoo reported revenue of $758 million, up 168% from the year-ago quarter, and net income of $101 million was up 115% year-over-year. Yahoo had $2.8 billion in cash at the end of the first quarter.
Stocks were struggling even before Google announced its intention to go public, but they turned sharply lower after the filing, perhaps due to concern about the market’s ability to absorb a $2.7 billion stock offering.
The Nasdaq fell 30 to 1958, the S&P 500 lost 8 to 1113, and the Dow dropped 70 to 10,272. Volume was unchanged at 1.86 billion shares on the NYSE, and rose to 2.38 billion on the Nasdaq. Decliners led 24-8 on the NYSE, and 23-8 on the Nasdaq. Downside volume was 77% on the NYSE, and 85% on the Nasdaq. New highs-new lows were 43-180 on the NYSE, and 55-65 on the Nasdaq.
After the close, Looksmart , Netease
and Newport
beat estimates, while Gateway
, Brightpoint
, Genesis Microchip
and Foundry
missed or warned.
During the day, Marimba soared 65% on news that it will be acquired by BMC
.
Macromedia , QLogic
, Symantec
, Jupitermedia
, Photon Dynamics
and S1
rose on their earnings reports.
JDS Uniphase , LSI
, Drugstore.com
, RealNetworks
, Openwave
, Akamai
, InfoSpace
, Advanced Fibre
, Sohu
and Cray
fell on their results.
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