SAN FRANCISCO — Google’s research arm, Google X, is called the company’s Moonshot Factory. One reason the company picked the word “Moonshot” was to remind people to tackle big problems that may well blow up in their faces.
Last month, after years of promotion, Google ended a test trial of its Internet-connected glasses, called Glass. While the device seemed to have promising commercial applications in hospitals or on factory floors, its first pass at the consumer world was unsuccessful.
The very public failure of Glass points to a bigger question. After patiently abiding a steep increase in research and development spending on efforts that range from biology to space exploration, Wall Street is starting to wonder when — and if — Google’s science projects will pay off.
“We want companies to continue to push the envelope, but there has to be some financial responsibility around that,” said Ben Schachter, an analyst at Macquarie Securities. “We have no real insight into what’s going on.”
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But for shareholders, whose patience is not usually as long as that of researchers, nothing is quite as reassuring as a shiny new product whose profits they can measure with each passing quarter. And if they cannot have that now, they would at least like to know when to expect it.
In a recent conference call with investors, Patrick Pichette, Google’s chief financial officer, was asked about the company’s many big investments.
“I just want to kind of reaffirm to you that we do it in a smart way and a disciplined manner,” he said. “We’re driving forward to make sure we don’t waste our shareholders’ money.”
