Largely because investors were concerned at Google's inability to maintain advertising prices.
In their own reported numbers, one critical measure is their 'cost per click' which fell -9% and this caused concern - notably on mobile devices where advertisers seem to want to pay less than the norm. Largely, this is because of a perception that the mobile screen is half the size of a PC/Desktop so they'll only pay, half.
The sale of Motorola Mobility to Lenovo at a discounted price, also caused worry. They sold is at 3 billion usd having paid over 12 bn.
All that said, the underlying performance of the company is still strong with Q1 revenues up +20% to over 15 billion usd and profits up +3% to over 3 billion usd. Although investors did expect more.
But one big, huge elephant in the room here, is the size of Google's market cap - a widely huge valuation. At circa 400 billion usd, a 6% slides wipes out a lot of value (circa 22 billion). It is the second highest market cap in America.
And frankly bears no resemblance to the level of profitability it's making although it has large cash reserves. There are growing concerns about the high values of tech stocks so even when the core business delivers great results, any shakiness, causes a major investor outflow.
This seems to sum it up.
