Google's Q2 Expected To Be In-Line, Some Analysts Are Still Concerned

Investors have mixed expectations for Google Inc GOOG GOOGL, which will report its Q2 2015 results on Thursday after the close.

"I think the revenues should come in-line, EPS a little ahead of consensus," B. Riley & Co. analyst Sameet Sinha told Benzinga. "Checks are indicating that business continues to be stable."

Global Equities Research analyst Trip Chowdhry said that he is "a little concerned" about Google.

"We think they still have to crack the mobile and nano devices, which is probably going to take some time," Chowdhry told Benzinga. "So we are cautious on Google."

Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, told Benzinga that Google "isn't innovating nearly as fast as they need to [in order] to catch up with Apple, in terms of a consumer experience, and Microsoft, in terms of a productivity experience."

"They squandered their opportunity with Chromebooks by messing around with two operating systems, Android and Chrome, and gave Microsoft time to fix most of their Windows 8 issues," said Moorhead. "Like Amazon, investors are trading heavily on perceived innovation and Google is on the decline."

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FX Headwinds

Sinha isn't too worried about the FX headwinds that could impact Google.

"FX headwinds, at least quarter-over-quarter, would not be very high," said Sinha. "And year-over-year, of course, it continues to be a big headwind. I think investors are giving the company some leeway because it's all FX related. I think that will be positive for them."

Sinha said that gross margins expanded "quite nicely" last quarter and that operating expenses declined quarter-over-quarter.

"I think that trend should continue," he concluded.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.