Google Banks Billions on Search, So Why are Investors Concerned?

Search is still Google's primary cash cow

Let's get one thing straight -- most businesses would happily switch places with Google based on the financial figures alone. The sultan of search pulled in $66 billion in revenue for all of 2014, up 19 percent year-on-year. That's thanks in part to a strong finish, with Google reporting consolidated revenues of $18.10 billion for the quarter ended December 31, 2014, a jump of 15 percent compared to the same quarter a year prior. Google's profit in the fourth quarter alone came to $4.76 billion, up from $3.38 billion in the fourth quarter of 2013, so why are some investors nervous?

There are a few reasons. As The New York Timespoints out, Google's net revenue growth in the last three months of 2014 slowed to 10 percent when compared to the same quarter a year ago. That's still not bad from a purely numbers perspective, though behind the curve when compared to recently reported results by two other tech giants, Facebook and Apple.

If continuing to nitpick, there are some other red flags, one of them being that the cost-per-click dropped 3 percent sequentially. This is the amount Google can charge advertisers for placing ads on its network, and according to a BBC report, the takeaway for investors is that Google is having a tough time raising the price it charges for mobile ads. That's concerning, since consumers are increasingly turning to mobile to access the Internet.

The other cause for some concern (from investors) is the lack of a safety net if Google's search business should take a turn for the worse for whatever reason. Revenue from Google's own sites makes up more than two-thirds of its overall business. And though Google has its hands in multiple different areas, like self-driving cars, none of them are big money makers.

Google's stock has taken a hit as a result -- it's lost 8.1 percent in the past three months, now trading at around $531. And if you go back to February of last year, it was trending around $609.

Much ado about nothing? That might be going too far in the other extreme, though as is often the case when it comes to investors, it might be much ado about little. I've seen these same complaints for years when it comes to dissecting Google (as well as other large tech firms). But the bottom line is Google is still coming out ahead each quarter, and by billions of dollars.

You can catch the rest of Google's financial report here.

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