Next Thursday, Oct. 18, Google (GOOG) will deliver its latest earnings release. It should be interesting for many reasons, including the opportunity to hear from CEO Larry Page himself.
We haven't really heard from Larry since the last earnings call in July. I believe he did an appearance on "Charlie Rose" in New York right after that time. Then we heard about some throat issue he was having. He apparently wasn't supposed to speak for some time but was still active in the company.
Eric Schmidt, Google's chairman, was asked about Larry recently and basically said that everything was fine and that this was a non-issue. We will get our first indication of that next week when we finally hear the man speak on the call.
Of course, investors will be interested in other substantive aspects of the call.
What's going on with cost-per-click lately? Is CPC still declining as the world moves to mobile from desktop?
What about paid clicks? Google has tried to rebut claims that the mobile shift is bad for it by pointing to how the number of paid clicks keeps going up. To this point, that has been very valid. Does the trend continue?
YouTube continues to be a monster for Google. Many companies are pushing new YouTube channels of late as a new distribution platform. Theoretically, Google should continue to scoop up display ads next to and in front of these clips.
In the recent quarter, there were a couple of weeks when Apple had switched out YouTube as a default on its home screen on the iPhone and Apple Maps for Google Maps. Will Google disclose anything about how those weeks affected its mobile revenue in the quarter? My guess would be that Google will say there has been no big shift. If it says anything, it will probably lament Apple's decision and call its products the best on the market. The rest of us will likely have to wait another quarter to really see some evidence in the numbers, to see if Apple's shift has cost Google anything.
What's going on with the Motorola integration? Google recently raised its cost estimates for severance plans. We also saw Google pull back from proceeding with a patent fight at the International Trade Commission with Apple. Why? Also, many have expected the Motorola acquisition to hurt Google's margins. We really haven't seen that to date, but we may get our first indication in this past quarter, after the closing of the acquisition.
Finally, the stock has been on a tear since July. Basically, it seems as though all the Facebook (FB) money flowed into Google after Facebook's IPO debacle. The move in Google shares is unprecedented, and the stock is now at all-time highs. Many Google bulls believe that the stock can keep it up and should be much further ahead of a 2007 high, when you compare where others stocks such as Apple trade relative to 2007 levels. Yet Google's stock is due for a cooling off or a pullback. Will this report next week provide the reasons for investors to ease off the accelerator?