| Google's 3rd quarter profit blows away Yahoo |
BEIJING, Oct. 20 (Xinhuanet) -- Figures released late Thursday show an increasing financial gap between Google Inc. and its nearest Internet advertising network, Yahoo Inc..
The results -- third quarter profit nearly doubled -- lifted Google shares by nearly 8 percent -- an upturn that translates into about 10 billion U.S. dollars in additional stockholder wealth.
"The difference between Google and the second and third place players has become enormous," Global Equities Research analyst Trip Chowdhry said. "This definitely shows that Google is going to own the next generation of the computing environment."
The performance surpassed analyst estimates by 20 cents per share and underscored the Mountain View, Calif.-based company's widening advantage over its main Internet rivals.
Yahoo Inc., which runs the Internet's second largest advertising network behind Google, has been hurt by slowing revenue growth most of this year -- a problem that contributed to a 38 percent drop in its third-quarter profit.
"Business is very, very good here at Google," Eric Schmidt, the company's chief executive, said during a Thursday conference call. "I am pretty amazed. I did not expect us to do as well as we did."
The company earned 733.4 million dollars, or 2.36 dollars per share, for the three months ended in September. That represented a 92 percent increase from net income of 381.2 million dollars, or 1.32 dollars per share, at the same time last year.
Revenue for the period totaled 2.69 billion dollars, a 70 percent increase from 1.58 billion dollars last year.
After subtracting the commissions paid to Google's ad partners, revenue fell to 1.86 billion dollars. That figure also topped analyst estimates by about 50 million dollars.
Google's success has hinged on its search engine, a piece of revolutionary technology that continues to attract new users.
In September, Google's held a 45 percent share of the U.S. search market, up from 44 percent in August, according to comScore Media Metrix. Yahoo's search share dipped to 28 percent in September, down from 29 percent the previous month while Microsoft Corp.'s share continued to hover around 12 percent, Media Metrix said.
Google continues to find new ways to pick out the ads most likely to pique enough interest to be clicked on, as Google makes money based on the number of clicks.
Google already is eyeing new opportunities such as online video ads with its planned acquisition of YouTube Inc., which has become one of the Internet's hottest entertainment hubs. Google hopes to complete the 1.65 billion dollar deal in the next month or so.
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