Google sales finally feel impact of economy

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The fall in advertising revenue has resulted in the first drop in quarterly sales for the first time since its incorporating as a public listed company.

The recession has had an impact on slower profits and sales, as users of the search engine are not clicking on ads as often. As a result, sales in the first quarter reached $4.07 billion, although analysts had predicted sales to be closer to $4.1 billion.

Chief Executive Officer, Eric Schmidt, admitted that the recession is still uncharged territory for the company and as a result cut backs are being made in research, marketing and side projects.

Advertisers are, in turn, spending less money online, particularly in the financial and motoring sectors. However, despite the 3 percent fall in Googlea��s Adsense the company has become more efficient with the operating margin increasing by a further 1 percent.

Google has proved to be very robust in the current financial turmoil and has managed to post an 8 percent annual increase in the slowdown, with only 58 jobs being cut out of the 20,000 staff employed by the company.

Googlea��s monopoly of the market keeps growing, with the US market share at nearly 64 percent meaning that the company is still able to grow.

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