Google stockpiles cash - but is Twitter on the shopping list?

 

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By Reuters

Posted on 5 Mar 2009 at 08:17

Google plans to let its cash "pile up" as it weathers an economic recession, but hasn't ruled out spending money on current web darling Twitter.

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

"We've not really discussed a dividend payment," he claims. "At the moment our view is to let the cash pile up."

Schmidt says the economic storm will affect all forms of advertising, including the online ads that Google depends on, but that the search king was unlikely to see a drop in revenue.

"We don't predict things like that," Schmidt said when asked if the company's diversity would shield it from the economic slowdown. But, he added, "from my perspective it's hard to imagine why you'd see a decline."

Schmidt claims Google is continuing to look at acquisition opportunities, but says he isn't sure if prices have reached their lows yet, or if the economic slowdown has reached its bottom.

Schmidt's comments came a day after he raised eyebrows at an investor conference by referring to micro-blogging 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.