Google said that shifting to a mobile operating environment would be a tremendous opportunity for the company. "With more devices, more information, and more activity online than ever, the potential to improve people's lives is immense," Larry Page, Google's CEO, stated.
However, analysts discussed that the mobile operating environment would present the tech giant some relevant challenges. Predominantly, the operating margin of Google is currently suffering. Its non-GAAP operating margin in the second quarter fell to 28% from last year's 33%. A non-GAAP earnings is defined as the alternative earnings measure of a corporation's performance. Analysts believed that the competitive landscape of Google was tougher these days than it was many years ago. A move to the mobile operating environment would give Google more revenue but it would also be a challenge as far as the company's profitability goes.
"Our revenue growth rate could decline over time, and we anticipate downward pressure on our operating margin in the future ... as a result of a number of factors, including increasing competition, changes in our product mix, including a significant increase in mobile search queries and a deceleration in the growth of desktop queries if monetization stays at current levels," Google said.
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