Why Wall Street is panicking over Google: 4 theories

What's wrong with Google? The search giant sent investors into a panic on Thursday when it reported disappointing third-quarter profits (down 20 percent) and sagging advertising rates. In response, share prices slid roughly 9 percent, falling to their lowest level in more than a month. What's going on? Here, four theories:

1. Investors panicked because the info was incomplete

The printer responsible for publishing Google's financials, R.R. Donnelley, mistakenly filed with the Securities & Exchange Commission four hours earlier than expected. That meant the draft was incomplete, which "might have been enough to freak out investors," says Alexis Madrigal at The Atlantic. "In the spot where the company's CEO normally has a statement, the press release read, 'PENDING LARRY QUOTE,'" referring, of course, to where remarks from CEO Larry Page would be. Later in the day, Google released a complete version of the earnings — "LARRY QUOTE" included.

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2. Google's ads are becoming less valuable

Wall Street had expected cost-per-click (CPC), a key metric for ads, to have already bottomed out, says Chris Ciaccia at The Street. "That hasn't happened." The average CPC price decreased 15 percent from last year, says Claire Cain Miller at The New York Times, and 3 percent from last quarter. "That was partially offset, though, by an increase in the number of clicks on Google ads, which rose 33 percent over last year." Nonetheless, it indicates an ominous trend.

3. Mobile advertising is proving harder than it looks

In general, Google "pulls in less revenue from the advertising it places on mobile devices than it does from traditional personal computers," says John Letzing and Ben Fox Rubin at The Wall Street Journal. And more and more users are accessing Google from their phones, creating a "downward trend for advertiser prices on Google, which has caused some concern."

4. The company is feeling the heat from regulators

Google faces fairly heavy pressure from regulators on antitrust and privacy issues, says Casey Newton at CNET. A majority of commissioners at the U.S. Federal Trade Commission want to bring an antitrust lawsuit against the company. They believe that Google's search algorithm favors the company's own products over the competition. "While regulators appear unlikely to require dramatic changes at Google, the heightened scrutiny and soaring legal bills could distract the company's executive leadership, analysts say."