Concerns about U.S. unemployment, the political impasse over the federal deficit, and sovereign debt in a number of European countries have overshadowed corporate earnings in the past few months. Even though bellwether tech companies have made impressive sales gains this year, their shares have been battered on the markets as economic worries have caused analysts and shareholders to question IT spending trends.
After the market closed Thursday, to US$9.03 billion. Excluding fees and commissions, net revenue was $6.92 billion, exceeding the $6.55 billion consensus forecast from analysts polled by Thomson Financial. Google's profit was $2.51 billion, up from $1.84 billion a year earlier.
Analysts have wondered whether Google could maintain its growth as it expands and faces mounting costs trying to branch out from its core strength in search ad sales. The results seemed to assuage fears for the moment.
"We believe the accelerating growth, particularly in the Google sites segment, and the rising net revenue per employee, even in the face of accelerated hiring, are clear indicators of the company's trajectory, and ultimately, the stock," said Canaccord Genuity analyst Heath Terry in a research note.
Google's strong report seemed to put the focus back on earnings, right before a week in which some of the biggest names in tech, including Apple, Yahoo, IBM, Microsoft, AT&T, Nokia, EMC, Intel and AMD are due to report their own results.