Google letting cash "pile up": CEO

SANTA BARBARA, California Thu Mar 5, 2009 4:40pm EST

Google Chief Executive Eric Schmidt attends a news conference in Beijing March 17, 2008. REUTERS/Grace Liang

Google Chief Executive Eric Schmidt attends a news conference in Beijing March 17, 2008.

Credit: Reuters/Grace Liang

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SANTA BARBARA, California (Reuters) - Google Inc plans to let its cash "pile up" as it weathers the economic recession, the Web search leader's Chief Executive Eric Schmidt said on Wednesday.

Google will only use its $8.6 billion cash cushion for "very very conservative investments," Schmidt said, and is unlikely to start a dividend in the current environment.

"We've not really discussed a dividend payment," he said in an interview on the sidelines of the Wall Street Journal ECO:nomics conference in Santa Barbara, California. "At the moment our view is to let the cash pile up."

Earlier on Wednesday, Schmidt said the economic storm would affect all forms of advertising, but he added in a CNBC interview that "from my perspective it's hard to imagine why you'd see a decline" in advertising revenue because of more diverse advertising platforms such as mobile devices.

"We don't predict things like that," Schmidt said when asked if the company's diversity would shield it from the economic slowdown.

Schmidt added later in the interview that he did not intend to give revenue outlook as Google does not give forward guidance.

Schmidt also said Google continues to look at acquisition opportunities, but said he wasn't sure that prices were at their lows yet, or that the economic slowdown has reached its bottom.

Schmidt's comments came a day after he raised eyebrows at an investor conference by referring to privately held online messaging service Twitter as a "poor man's email system."

Asked about speculation that the comments were part of a negotiating tactic by Google in hopes of acquiring Twitter, Schmidt said he didn't want to speculate on buying or selling companies.

"We admire Twitter," Schmidt said.

(Reporting by Alexei Oreskovic and Nichola Groom; editing by Richard Chang and Muralikumar Anantharaman)

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