Why Google isn't growing

Why Google isn’t growing

Google CEO Larry Page can be forgiven for being in a bad mood this weekend. On his company’s Q1 2014 earnings call, his people delivered what he thought would be good news: revenues of $15.4 billion, up 19%. Very, very few business can deliver 20% growth on billions in revenues. By any measure, Google is on fire as a company.

 

 

 

Why Google isn't growing

Yet investors hated it.

They sold the stock, and it declined 5% immediately after the call. In 24 hours the price had lost $9, from $544 per share to $536.

Google is growing, for sure. But, counterintuitively, it is not growing at the same time, as the following charts show.

From a macro perspective, Google is boxed in by two factors: The available population on the Internet and the population on the mobile portion of the Internet.

Google – according to numbers from Asymco, the quant-y tech analysts – may not be growing so much as it is merely floating in place on a rising tide of humanity.

Unfortunately for Google, that tide is about to go out.

Internet growth is slowing – and Google is the Internet Google handles about 80% of all search queries, and hundreds of millions of people use Gmail and YouTube, its most famous brands. Google is so dominant that its economics are, in many ways, a proxy for the Web as a whole. How grows the Internet, grows Google.   Read More News>>

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