Google quarterly profit swells 46 percent
Earnings topped Wall Street expectations, fueled by accelerating market share gains and tighter cost controls.
Third-quarter net income rose to $1.07 billion, or $3.38 per diluted share, compared with the year-earlier quarter's $733.3 million, or $2.36 per diluted share. Excluding one-time items, profit was $3.91 per share in the latest quarter.
Gross revenue rose 57 percent to $4.23 billion.
"We are very pleased with the impressive growth we experienced across our business," Chief Executive Eric Schmidt said in a statement.
Shares of Google rose about 1 percent. The stock climbed to $645.18 from a close of $639.62 on Nasdaq.
Wall Street was looking for a net profit, on average, of $3.22 per share, according to Reuters Estimates. Excluding one-time items and stock compensation costs, the average analyst estimate was $3.77 per share.
Analysts, on average, expected quarterly revenue to grow 54 percent from a year ago to $4.13 billion. Ever-larger numbers mean its growth rate is down from 70 percent in the third quarter of 2006 and 96 percent in the same period of 2005.
"Overall, good results, modest upside, but not a blow-away quarter," Global Crown Capital analyst Martin Pyykkonen said.
Third-quarter revenue forecasts ranged from $4.00 billion to $4.29 billion, according to Reuters Estimates. Fourth-quarter growth is expected to slow to 47 percent. The company is growing four to five times faster than
Operating expenses totaled $1.25 billion, or 30 percent of revenue, despite the fact that its headcount grew 15 percent to 15,916 employees during the three months ended in September.
Last quarter, Google shocked investors when expenses shot to 31 percent of revenue from 27 percent in the first quarter. Stock compensation dipped to $198 million in the third quarter from $242 million for the second quarter ended in June.
Google led the U.S. Web search business with 57 percent market share in September, up from 56.5 percent in August, according to Comscore Inc data. It is even more dominant internationally, with more than 70 percent of the audience for Web searches.