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.