Google income doubles to €1.03bn

GOOGLE has said fourth-quarter profit more than doubled as the company expanded its lead over Yahoo and sold more advertising outside the US.

Net income rose to $1.03 billion (€790m), or $3.29 a share, from $372.2m, or $1.22, a year earlier, Google said yesterday.

Sales excluding revenue passed on to partners rose to $2.23bn, compared with the $2.2bn estimated by 29 analysts in a Bloomberg survey.

Google widened its lead in web queries, winning almost half the market in the US last quarter, according to researcher ComScore Networks.

Chief executive Eric Schmidt turned to international markets such as France and Germany and new products including online video ads to sustain the fast pace of growth investors have come to expect from Google.

Profit, excluding stock-based compensation costs, was $3.18 a share. Analysts had estimated profit at $2.91, according to the average in a Bloomberg survey. Before yesterday, California-based Google had beaten analysts’ profit estimates in all but one of its nine quarters as a public company.

Google shares, up 16% in the past year, rose $7.18 to $501.50 at 4pm in Nasdaq Stock Market trading.

Google is looking beyond the small text links that appear next to search results for the next wave of growth. The company bought YouTube for $1.65bn in November to tap the video ad market, and has tested ad sales in 50 newspapers and on radio. Products such as online maps and email are pushing users back to Google’s search engine.

Google maintained its policy of not forecasting earnings, a practice it says is designed to prevent managing earnings to analysts’ estimates.

Spending on internet ads in the US may rise 23% to $20.7bn this year, accounting for 7% of total ad spending, according to Merrill Lynch analyst Lauren Rich Fine. Internet search ads will be the largest and fastest-growing part of the industry, Mr Fine said in a December 1 note.

Bloomberg.