Google profits beat analysts' expectations
Google, the internet search engine, has announced strong results for the first three months of this year.
Net profit for the quarter was $1.42bn (£0.95bn), up 9% compared with the $1.31bn posted a year earlier.
Revenues came in at $5.51bn, 6% higher than for the same period last year but a decrease of 3% on the last quarter.
The results were better than many analysts had expected bearing in mind the recession in the US and the general downturn in advertising spending.
"Google had a good quarter given the depth of the recession," said Google chief executive Eric Schmidt.
"These results underline both the resilience of our business model and the ongoing potential of the web as users and advertisers shift online," he added.
Mr Schmidt did, however, admit that Google had been affected by the economic downturn.
"We are in uncharted territory economically and Google is, absolutely, feeling the impact," he said.
The strong results were largely due to Google.com, the company said. Google-owned sites generated revenues of $3.7bn.
This represents a 9% increase year-on-year.
Revenue from partner sites fell by 3%.
Revenues from outside the US totalled $2.88bn.The UK accounted for $733m.
Mr Schmidt said that Google was well positioned with regards to the advertising slowdown that has hit many companies hard.
"Advertisers are still spending, but they are lowering their bids," said Mr Schmidt.
"The shift to online advertising gives us a big advantage and outpaces any losses from [falling] economic activity," he added.
Analysts agreed with this prognosis.
"As advertisers are getting better control of their budget and a better understanding of their business under these macro conditions, they are taking money away from newspaper and television and going back online to advertise, and Google gets a disproportionate part of the market," said Sameet Sinha at JMP Securities.
Mr Schmidt did sound a cautionary note when describing the second and third quarters as "seasonally weaker", but concluded optimistically that: "We are well placed for the recovery and will continue to invest for the long term."
The results were well received by investors.
"It was a good quarter. Revenues were in line with [Wall] street consensus," said Jason Avilo at Kaufman Bros.
Richard Fetyko at Merriman Curhan Ford said: "It looks pretty good. Revenues are in line, which I think will actually positively surprise people."