The World Cup Runs Over Google
Google can't be a big fan of FIFA's World Cup, the month-long futbol extravaganza. The reason? Hundreds of millions of people are watching the matches on television, and hundreds of thousands are expected to attend the games in person. For Google, and other Internet companies, that translates into less Internet activity in general, which in turn has a negative effect on revenues for this financial quarter and the next, said analysts at Lehman Brothers. The impact, financial or otherwise, extends beyond the tourney's 30 or so days. Lehman analysts suggest that large numbers of people, especially in Europe where Google has a strong market share, may have delayed vacations until after the competition ends. This is not to say Google won't be reporting its usual gangbuster financial results when they are due up next. In fact, Lehman analysts said they expect Google to at least beat, if not exceed, financial expectations when reporting its second quarter financial results. Yet, the World Cup shows just how fortunes can sometimes swing on something as simple and disconnected from Google as 11 men in short pants kicking a ball around a field. |
Comments (4)
why is it that I disagree? oh, that's because a lot of people are monitoring the games from work online, like amy whole office.
Posted by Boris | June 21, 2006 1:09 PM
Yes, but Boris, analysts have been predicting for months that absenteeism in the UK alone will cost businesses over 100M pounds per day. If they ain't at work, they ain't on Google, dig?
Posted by Steve Bryant | June 21, 2006 2:10 PM
So, this says that the world cup will have a negative impact on Googles revenue, but that Google will still post higher-then-expected earnings. Cool way to make a statement that can't be proven wrong...
Posted by Mark | June 21, 2006 7:52 PM
You can prove Ben wrong by finding out if Google had more or less queries during the World Cup vs. a comparable time period, or if PPC revenues fell during the 30 day tourney. (Well, actually you'd be proving Lehman Brothers wrong.) Just because revenue is expected to decrease during a specific time frame within a quarter does not mean that total revenue over the quarter will fail to meet expectations. It simply means that the margin between expectations and reality may shift.
Posted by Steve Bryant | June 21, 2006 11:29 PM