Google Inc(NASDAQ:GOOG)
has put the blame on R.R. Donnelley & Sons, a financial printing company
for the premature release of results that revealed a shortfall
in profits. This has resulted in plunging of shares. Also, Larry Page, CEO
of Google has to bear the brunt of jokes that are being shared extensively on
Twitter.
The results of third
quarter were filed with regulators and made public to news wires with a
placeholder for a quote from Page with a timestamp of 12:30 pm in New York.
R.R. Donnelley has filed a draft of the document without authorizations, as
told by Google on its blog later.
The timing has raised a
number of concerns regarding the ability of the company to release sensitive
financial information in a fair manner, as told by the corporate governance
professor of Stanford Graduate School of Business, David Larcker. The drop of
9% in shares of Google, the largest web search engine in the world has wiped
over $22 billion from the market capitalization in a matter of a few minutes.
Larcker said that it is
highly unlikely that this matter will be cut loose ahead of time. It seems to
be a big deal since the markets pivot on appropriate disclosure. It is indeed a
matter of concern that some people get the news before others.
The document was made
public in the middle of a press conference that Google was holding to declare
its new Chromebook in San Francisco. This has resulted in several reporters to
rush out to cover more information on the matter. Google has stopped trading of
its stocks to make final alterations to the document. The stock had dropped
earlier after the release was published, showing profits and sales falling
short of the projections made by analysts.
No comments:
Post a Comment