Google Says Employees First Shareholders Second

Google (GOOG) released there earnings this week and had a couple of surprises. First their revenue was stronger than expected due to the economic meltdown. Good news for investors, it looks like Google is more recession proof than most. But here comes the bad news. Google took a $1 billion charge to write down bad investments in AOL and Clearwire. Second, Google is repricing their stock options for employees costing shareholders almost $500 million. This is nothing more than corporate charity for Google employees. Eric Schmidt, Google CEO, said that, “At least 85% of employees have stock under water.” That certainly makes for a lot of unhappy employees.  This really makes a mockery of the “align employee interests with shareholders” argument. What this tells me is Google is saying we don’t care about shareholders and our stock is not going to be going up anytime soon. It also says we will do just about anything to keep our employees.