The expense trimmed net income to $1.8 billion, or $5.51 a share, in the first quarter, Google said May 10 in a regulatory filing. The shares have fallen 9% this year to $529.55 on May 13 in Nasdaq Stock Exchange trading.
Until now the Mountain View, California-based company has relied on a short-term debt financing program that allowed it to borrow as much as $3 billion by issuing commercial paper, according to the quarterly filing. The debt has a weighted average interest rate of about 0.3% and weighted average maturity of about 163 days, it said today in a filing that didn't specify the size or maturities of the bond sale.
Commercial paper typically matures within 270 days and is used to finance everyday activities such as payroll and rent.
Yield Levels
The average yield on investment-grade debt sold in the U.S. fell to 3.78% on May 9, the lowest since Nov. 23, before rising to 3.8% at the end of last week, according to Bank of America Merrill Lynch index data.
Google Chief Financial Officer Patrick Pichette said in a December conference call that low interest rates hadn't lured the company into exploring financing through long-term debt.
"My job is to make sure that we have the perfect capital structure that fits our strategic needs," Pichette said. "If at the right time we decided that actually more long-term debt would make sense, right, we'd announce it."
Citigroup Inc., Goldman Sachs Group Inc. and JPMorgan Chase & Co. are managing today's bond sale, according to the regulatory filing.