Google's 1Q Profit Climbs 30 Pct And Tops Analyst Views

By: AP
By: AP

SAN FRANCISCO - Google Inc.'s first-quarter profit climbed 30 percent to surpass analysts' predictions in a performance that alleviated some of the economic worries that have hammered the Internet search leader's stock this year.

The news, released after the stock market closed Thursday, lifted Google's recently drooping shares more than 11 percent.

The Mountain View-based company said it earned $1.31 billion, or $4.12 per share, during the first three months of the year. That compared with $1 billion, or $3.18 per share, in the first quarter of 2007.

If not for expenses to cover stock given its employees, Google said it would have made $4.84 per share.

That figure outstripped the average projection of $4.52 per share among analysts surveyed by Thomson Financial.

The financial targets that guide Wall Street's expectations had fallen during the past two months as Web surfing data convinced analysts that fewer people have been clicking on Google's links to advertising amid mounting evidence the U.S. economy had tumbled into a recession. Google makes money from the links only when Web surfers click on them.

Google's showing indicates the Internet's advertising market remains robust.

First-quarter revenue totaled $5.19 billion, up 42 percent from $3.66 billion a year ago.

After subtracting the commissions paid to the company's advertising partners, Google's revenue stood at $3.7 billion — about $100 million above analyst estimates.

The results restored some of the $75 billion in shareholder wealth that had evaporated with the 35 percent drop in Google's stock price this year.

Google shares rose $51.46, or 11.5 percent, in after-hours trading Thursday after declining $5.49 finish the regular session at $449.54.

This was the 12th quarter out of 15 since Google went public that its performance has topped analyst expectations — a trend that had helped propel its stock to dizzying heights until the recent plunge.


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