Google Blows Past Expectations, Shares Rise

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[url="http://www.reuters.com/article/2011/10/13/us-google-idUSTRE79A3ZL20111013"]http://www.reuters.com/article/2011/10/13/us-google-idUSTRE79A3ZL20111013[/url]

[size=4]Google Inc's results trounced Wall Street expectations with the help of strong advertising sales and deft cost controls, driving its shares nearly 7 percent higher.[/size]

[size=4]The Internet search and advertising leader, benefiting from an expanding online ad market and sharper focus in research, [b]increased its profit by 26 percent and revenue by 37 percent in the third quarter.[/b][/size]

[size=4]A darkening economic outlook -- particularly in Europe, had stoked worries about advertising growth. But Google's revenue and paid-clicks performance boded well for the fourth quarter, analysts said.[/size]

[size=4]Shares of Google rose to $597.93 in extended trade after closing 1.91 percent higher on Nasdaq.[/size]

[size=4]"The real interesting thing here is the expenses that weren't as high as the Street was anticipating. R&D was less than we were expecting," said UBS analyst Brian Pitz. [b]"This is the fourth quarter in a row the company has accelerated their revenue on top line."[/b][/size]

[size=4]Chief Executive Larry Page -- who assumed the top job this year and had to contend with fears on Wall Street he would let costs spiral out of control -- has begun whittling down Google's sprawling portfolio of initiatives and projects.[/size]

[size=4]On a conference call with analysts, he said the company would instead divert resources to projects with higher potential returns.[/size]

[size=4]"We have to make tough decisions about what to focus on, or we end up doing things that don't have the impact that we strive for," Page said. "Since we last spoke we've begun the process of shutting over 20 different products."[/size]

[size=4][b]The company is plowing money into its fast-growing mobile business and increasingly competing with Apple Inc[/b]. Google's Android mobile software, already the world's most-used smartphone platform, is gaining momentum. [b]It powers 190 million devices, up from 135 million in mid-July.[/b][/size]

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