Google's 2Q sales growth slows, a sign for tech firms' economic recovery

Posted by Simon Day on July 17, 2009 at 11:41 AM

Google Inc.'s second quarter sales were slower, the search giant reported, at just a 2.9 percent increase from a year earlier, a decline of 6.2 percent from the first economic quarter, Bloomberg reported Friday. The company's ad prices were down and its share price had fallen almost 2.5 percent.

This slowdown is an indicator that the technology industry's economic recovery will likely be slower than analysts expected, according to Bloomberg.

"It's just a reminder that we're not off to the races here -- this is going to take some time," Ben Schachter, an analyst at San Francisco-based Broadpoint AmTech Inc., told Bloomberg. "Intel got a lot of people excited."

Google's largest revenue source, online advertising, is down as businesses attempt to weather the economic crisis. London-based research firm ZenithOptimedia predicted just a 10 percent growth in online advertising for 2009, compared to 22 percent growth last year.

Google Chief Executive Officer Eric Schmidt said it is "too early for us to tell when the recovery materializes."