Market Overview

Google Earnings: Estimates Have Been Falling Since January

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Google Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) will announce its first quarter financial results on Thursday afternoon, after the market closes.

Estimize provides crowdsourced and analyst earnings estimates. Looking at this data, one thing comes to light: the crowd is considerably more bullish on Google than Wall Street analysts are.

Wall Street analysts project consensus EPS of $6.63 on revenue of $14.061 billion. The crowd, for its part, expects EPS of $6.78 on revenue of $14.261 billion.

These estimates imply some growth from earnings of $6.27 per share in the same quarter last year, but a decline from last quarter’s $6.88 mark.

Related Link: Hi Fi: Google, Sprint And T-Mobile Partner To Launch Wireless Service

The graph below illustrates the company’s history of estimates versus actual earnings:

It's also possible to see how estimates have changed over time.

Similar to Amazon’s case, Google is facing falling expectations as earnings loom. Since January, the crowd’s estimate has tumbled more than 7 percent, while the Street’s projections declined almost 5 percent.

What Analysts Think

In a recent report, analysts at Wedbush reiterated a Neutral rating on shares of Google, and recommended investors to be “cautious” before earnings.

The firm expects EPS of $6.56 on revenue of $13.75 billion.

They noted: "Overall, our checks and industry data points from search engine marketers (SEMs) suggest decelerating spending trends for 1Q driven by a slowdown in paid clicks. We are modeling core Google gross advertising revenue growth of 10% y/y for 1Q (vs. 15% y/y in 4Q14 and 17% y/y in 1Q14) and 10% y/y for 2015; on a FX adjusted basis, we are modeling 15% y/y for 1Q (vs. 18% y/y in 4Q14 and 18% y/y in 1Q14)."

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