Will external factors like foreign currency markets play into Google’s earnings or have they taken appropriate measures to counteract them?

Investors are putting up their GOOG predictions this week ahead of Google’s earnings call.  Recent updates seem to be centered around Google’s decision to stop selling the Nexus One on its site and the recent sharp increase in U.S. Dollar valuation against foreign currencies. Google brings in a significant majority of its revenues from overseas.

To counter rapid currency fluctuations in countries where it does significant business, Google has likely taken to a strategy of hedging against money market changes in its newly ramped up investment wing.  But, will it be sufficient to counter the strong U.S. dollar that has spooked investors?

We’ll find out in a few hours.

On average, analysts expect the company to report earnings of $6.52 per share on revenue of $4.99 billion. In the previous year’s period, the company reported earnings of $5.36 per share on revenue of $4.07 billion.

One other analyst got in under the bell this morning. Imran Khan from JP Morgan Chase, in a ’60-Second Preview of 2Q Earnings’, said to expect Google net revenue to be down 2.8% sequentially compared to consensus estimates of a 1.6% decline. He thinks anything less than a 1% decline will be perceived positively by the Street.

SAI provides the following convenient cheat sheet: