March 5, 2009
Google To Slow Down On Acquisitions During Recession
Google's Chief Executive Eric Schmidt said on Wednesday that the company plans to let its cash "pile up" as it weathers an economic recession, but doesn't expect to see a fall in revenue, Reuters reported.
Schmidt said Google would only use its $8.6 billion cash cushion for "very very conservative investments" and is unlikely to start a dividend during the recession.He told the New York Times at the ECO:nomics conference in Santa Barbara, California, the company had discussed a dividend payment but said at the moment Google would "let the cash pile up".
Schmidt said on Wednesday that the economic storm would affect all forms of advertising "” including the online ads that Google depends on. However, he suggested that Google was unlikely to see a drop in revenue.
When asked if the company's diversity would shield it from the economic slowdown, Schmidt said Google doesn't "predict things like that."
However, he added, "From my perspective it's hard to imagine why you'd see a decline."
Schmidt acknowledged that while Google continues to look at acquisition opportunities, he wasn't sure that prices were at their lows yet, or that the economic slowdown had reached its peak.
Earlier in the week, Schmidt referred to the privately held online messaging service Twitter as a "poor man's email system" at an investor conference, prompting many to question whether the comments were part of a negotiating tactic to acquire the micro-blogging service.
When asked about a possible Google acquisition of Twitter, Schmidt said he didn't want to speculate on buying or selling companies.
"We admire Twitter," was all he said.
Image Courtesy UPI
On the Net: