Google tops Wall Street views, profit up 32 percent

Google posted a significant gain in third-quarter profit Thursday that topped Wall Street estimates, thanks to increasing demand for the internet search giant’s online advertising.

Google said its third-quarter net income rose to $2.17 billion, or $6.72 a share, from $1.64 billion, or $5.13 a share, in the same period last year. Net revenue for the period ended in September rose to $5.5 billion. Excluding one-time items, Google said earnings for the quarter were $7.64 a share.

Analysts polled by Thomson Reuters had expected Google to post earnings excluding items of $6.69 a share, and $5.3 billion in net revenue.

“Our core business grew very well, and our newer businesses — particularly display and mobile — continued to show significant momentum,” Google CEO Eric Schmidt said in a prepared statement.

Shares of Google rose more than six percent to $577.14 in after-hours trading, following the earnings report.

The Mountain View, Calif.-based company said its rate of paid clicks, or the number of times users clicked on its advertisements and generated revenue, rose 16 percent compared to the same quarter last year.

Wall Street analysts had been looking for paid click growth of roughly 15 percent.

Meanwhile, Google said the prices paid for clicks on advertisements rose three percent compared to the period last year, roughly matching analysts’ expectations.

Even as Google’s business has flourished, analysts and investors have been wary of how much the company has been spending to pull in new talent.

Google said Thursday that it added more than 1,500 employees during the recent period, a seven percent quarterly headcount increase that was the company’s highest since the first quarter of 2008.

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