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Last Updated: Thursday, 20 October 2005, 22:19 GMT 23:19 UK
Ads fuel soaring Google profits
Google's headquarters at Mountain View, California
Google's chief described the latest results as "exceptional"
Internet search engine Google has reported a jump in quarterly profits on the back of strong advertising sales

Google saw its net income rise to $381.2m (215m) in the three months to 30 September, from $52m at the same time in the previous year.

The US web giant said its revenues in the third quarter hit $1.578bn, up 96% on the same quarter last year.

Most of Google's revenue comes from ad sales. Shares in the firm rose more than 8% in after-hours US trading.

"Incredible quarter"

They gained significant market share from every search provider
Jordan Rohan, RBC Capital Markets analyst

"Although this is typically a slower season for internet properties, we had another exceptional quarter," said Google chief executive Eric Schmidt.

"Our focus on end users and on quality of information and advertising worldwide continues to work extremely well. We are very pleased with how well this is working at scale."

Analyst Jordan Rohan, of RBC Capital Markets, said it had been "another incredible quarter for Google".

"They gained significant market share from every search provider," he said.

Fresh high

Google said the introduction of new products, including instant messaging and upgrades to its mapping services, had attracted more users during the summer - traditionally a slow season in the industry.

The latest quarterly profits were the highest of any three-month period since Google was launched seven years ago.

The California-based company floated its shares in the US in August 2004, in what was the third richest US-based IPO on the Nasdaq exchange.

Adjusting for special items, Google shares are valued at 42 times its estimated profits for 2006, in line with fierce rival Yahoo.

Last year's third-quarter results included a $201m charge to account for a legal settlement with Yahoo.

Although Google's stock rose in after-hours trading, shares in the company closed down almost 2% at $332.46 ahead of the announcement of its results.


BBC NEWS: VIDEO AND AUDIO
A look around Google's offices in New York



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