Google Grows CapEx Faster Than Revenues

Jul.24.06 | About: Alphabet Inc. (GOOG)

Three guesses, and the first two don't count, why Google didn't trade higher Friday, despite beating on sales and earnings. Give up?

It's not that the company didn't post blow-out numbers, as some are suggesting. The numbers were good enough enough that bulls could have made that case, but they tripped over something.

I maintain that the culprit is GOOG's pesky capex figure. The company continues to grow capex faster than revenues, putting up a near $700m figure this quarter. What are these guys, a utility or something? Soon they'll be floating bonds.