The Wall Street Journal beats Google at its own game with this delightful play on the company's logo
Google Inc. filed to go public today, setting plans to raise as much as $2.7 billion in an initial public offering and giving investors their first look at the secretive company's revenue and earnings, reports The Wall Street Journal (available to subscribers only):
The $2.7 billion proposed maximum size of the deal . . . would immediately rank it among the fifteen largest IPOs in U.S. history. Estimates of the post-offering market value of the company have varied significantly, topping out at around $25 billion.
Unlike a traditional initial public offering, Google plans to sell the shares through an unusual auction conducted by its underwriters on the company's behalf, in an effort to make the shares more widely available . . . The company posted a profit of $105.6 million in the year ended Dec. 31, 2003, up from $99.7 million a year earlier [and] has been profitable since 2001, when it posted net income of $7 million on revenue of $86.4 million.
Founders [Larry Page and Sergey Brin] "have designed a corporate structure that will protect Google's ability to innovate and retain its most distinctive characteristics." Part of that will be a dual-class structure, in which the founders will hold a higher-vote class of stock that will allow them to control much of the company's fate.
Although Google's stock won't actually be sold for several more months, Thursday's filing represents a significant milestone in the company's evolution from a fun-loving start-up to a corporate adolescent that will be held more accountable for how it manages its money.
"The enthusiasm for a Google IPO also demonstrates the importance the search function has assumed in how people use the Internet, helping shape the sites they view, the news they read and the products they buy, notes the Journal:
There is a revenue stream to match: Advertisers increasingly use search sites as a way to buy more targeted advertising, since the sites can match up ads with what people are looking for. Microsoft Corp. and Yahoo Inc. are among the players that have concluded that search is of such strategic importance that they have poured money into their own search offerings recently.
Google offers its search engine to Internet users free of charge. It also licenses the technology to organizations such as Procter & Gamble Co. and the U.S. Army for their internal use and to Web sites such as Time Warner Inc.'s America Online unit to power consumer searches. Most of Google's revenue comes from small text ads that Google sells on its own site, as well as the Web pages of other companies. Advertisers bid for the right to have ads appear each time a user searches for certain keywords or those words appear on the Web site of a Google partner.
Meanwhile, reports FOXNews financial guruette Terry Keenan, "It is Googlemania on Wall Street." Get our stockbroker on the phone!
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