SAN JOSE, Calif. — In a surprise shake-up announced Thursday, Google co-founder Larry Page will take charge of the company’s day-to-day operations as chief executive, replacing current CEO Eric Schmidt, who will focus on strategic projects and, in particular, new products.
“We’ve been talking about how best to simplify our management structure and speed up decision-making for a long time,” Schmidt said in a statement released by Google. “By clarifying our individual roles, we’ll create clearer responsibility and accountability at the top of the company. In my clear opinion, Larry is ready to lead, and I’m excited about working with both him and Sergey for a long time to come.”
Internally, Schmidt, 55, will continue to act as an adviser to Page, 37, and Google co-founder Sergey Brin, also 37, who will also focus on strategic projects and new products. The reshuffling takes effect April 4.
“Eric has clearly done an outstanding job leading Google for the last decade,” Page said in a written statement. “The results speak for themselves. There is no other CEO in the world that could have kept such headstrong founders so deeply involved and still run the business so brilliantly. Eric is a tremendous leader, and I have learned innumerable lessons from him.”
Google also announced its fourth-quarter earnings were $2.5 billion, or $7.81 per share, during the final three months of 2010. That’s a 29 percent increase from net income of $2 billion, or $6.13 per share, in the prior year. Revenue climbed 26 percent to $8.44 billion.
Excluding stock-compensation expenses, Google says it earned $8.75 per share. That figure topped the average analyst estimate of $8.06 per share, according to FactSet.
Google in 2010 embarked on an ambitious strategic agenda, spending well over $2 billion as it scooped up more than 30 small startups and larger established companies starting in the fall of 2009, and adding 3,500 people to its global workforce. But Google was rebuffed on what would have been its biggest purchase — a reported $6 billion bid for discount broker Groupon.
Investors were unmoved by that strategic focus: Google stock underperformed the market in 2010, rising about 9 percent over the past year.
In recent days, Google has taken a back seat in the news to rivals such as Apple and Facebook. But Google stock has climbed 6 percent in the past month, getting another jump Tuesday following news that Apple CEO Steve Jobs was going on an indefinite medical leave. The stock has also been rising based on speculation that Google ad revenue would benefit from a strong holiday season.
Analysts polled by Thomson Reuters I/B/E/S had predicted that Google would report net revenue of $6.06 billion for the fourth quarter, up roughly 10 percent from the previous quarter, and 22 percent year on year.
The Associated Press contributed to this report.
