Google Earnings Preview: Motorola Acquisition to Drive Explosive Sales Growth

Overview Internet search leader Google GOOG is expected to release its fiscal fourth-quarter earnings results after the closing bell on Tuesday. Last week, Google shares fell almost 5 percent heading into the key report to just above $704. At current levels, the company has a market cap of $231.50 billion. Earnings Estimates Heading into the report, Wall Street analysts have consensus earnings per share estimates for the company of $10.54. This implies year over year earnings growth of around 11 percent compared to the $9.50 per share that Google reported in last year's fourth quarter. The high EPS estimate on the Street is $11.91 with a low estimate of $8.78. Sales Expectations Analysts have consensus revenue estimates for the fourth-quarter of $12.27 billion. This represents growth of nearly 51 percent versus the $8.13 billion in sales the company reported in last year's corresponding quarter. The large jump in sales is attributable to Google's $12.5 billion acquisition of Motorola Mobility Holdings last May. Core revenue at the company is expected to grow considerably less. The high sales estimate for the fourth-quarter is $12.72 billion with a low estimate of $11.35 billion. Current Trends Over the last three months, earnings estimates for Google have fallen from $10.79 to the current consensus estimate of $10.54. Estimates for next quarter have gone down from $10.72 to $10.61. During this time Google shares have gained a little better than 3 percent. Overall, analysts expect Google to report earnings growth of 10.30 percent and sales growth of 42.50 percent for the current fiscal year.