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Sat, Apr 22, 2006 - Page 10 News List

Shares soar after Google announces rise in profits

AP , SAN FRANCISCO

Google Inc's first-quarter profit rose 60 percent, soaring past analyst estimates as the company's Internet-leading search engine solidified its position as the Web's most popular advertising vehicle.

The report sent Google shares rising more than 7 percent in late trading.

The Mountain View, California-based company said on Thursday that it earned US$592.3 million, or US$1.95 per share, during the first three months of the year. That compared with net income of $369.2 million, or US$1.29 per share, at the same time last year.

Quarterly revenue surpassed US$2 billion for the first time in Google's 7 year history, reaching US$2.25 billion -- a 79 percent increase from US$1.26 billion last year.

After subtracting the commissions that the company pays to thousands of advertising partners, Google's revenue totaled US$1.53 billion.

Google's revenue, excluding ad commissions, exceeded the average analyst estimate by US$90 million.

The company released the results after the stock market closed. Google shares gained US$4.50 to finish at US$415 on the NASDAQ Stock Market, then climbed US$29.89, or 7.2 percent, in extended trading.

"We are obviously very happy with our first-quarter results," Google CEO Eric Schmidt said during a conference call with analysts. "We basically have good news across the business."

The strong showing provides another lift for Google's stock, which has surged by more than 20 percent since its addition to the Standard & Poor's 500 index was announced a month ago.

The inclusion to the widely watched market barometer reversed the negative sentiment that had been swirling around Google after the company missed analyst earnings estimates in its previous quarter.

Google's first-quarter performance made investors' recent worries seem misguided. The results also appeared to validate recent research indicating that the company has been widening its search engine lead over its biggest rivals, Yahoo Inc and Microsoft Corp.

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