http://www.bloomberg.com/news/2011-04-15/google-falls-after-posting-biggest-increase-in-costs-since-2008.htmlGoogle Inc. (GOOG) fell the most in nine months after a first-quarter hiring binge and increased marketing led to the biggest jump in operating expenses in three years.
First-quarter operating costs rose 54 percent, outstripping a sales gain of 29 percent to $6.54 billion, the Mountain View, California-based company said yesterday. Profit excluding some items was $8.08 a share, below the average analyst estimate of $8.12 compiled by Bloomberg.
Larry Page, who replaced Eric Schmidt as chief executive officer last week, is ramping up spending to pursue new growth opportunities, including mobile and video advertising. Google boosted hiring by more than 1,900 people during the quarter, part of a plan to add at least 6,000 this year. At the same time, he’s grappling with growing regulatory scrutiny of the company’s market-leading Internet-search business.
“The concern is that the expense discipline may be leaving as Eric Schmidt steps away,” said Clayton Moran, a Boca Raton, Florida-based analyst at Benchmark Co., who recommends buying the stock and doesn’t own it. “The company through the recession had shown significant financial discipline.”
--well folks this is how hiring gets rewarded.
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