Google shares below 300 for first time since 8217;05

The global economic slowdown is impacting many companies8217; advertising budgets, hurting Google8217;s main business, paid search ads.

Citigroup analyst Mark Mahaney said in a note that the online advertising growth rate is likely to slow in the fourth quarter for top e-commerce companies such as eBay Inc and Amazon.com Inc. The slowdown will likely impact Google, he said.

Mahaney cut his fourth-quarter earnings and net revenue forecasts for Google by 3 per cent, to 5.03 a share and 4.16 billion, respectively. He lowered his 2009 earnings and net revenue forecasts by 5 per cent, to 21.18 a share and 17.46 billion.

Analysts, on average, expect Google to earn 5.10 a share for the fourth quarter and 22.39 a share for 2009, according to Reuters Estimates.

Collins Stewart analyst Sandeep Aggarwal lowered his outlook on Google for the fourth-quarter and 2009, citing further weakening in the retail and advertising sectors.

8220;We believe that the high CPC costs-per-click inflation Google has been experiencing for the past six quarters is not sustainable and will pressure core search growth8221; in the fourth quarter and 2009, Aggarwal said in a note.