Google’s Revenue Surges

NEW YORK Google delivered impressive quarterly financial results Thursday in stark contrast to the dismal performance chief rival Yahoo! put in earlier this week.

Google’s Q1 revenue on a like-for-like basis was $3.67 billion, up nearly 65 percent from the same period a year ago. (Deducting the revenue Google pays to its ad partners, sales were $2.55 billion, still a gain of more than 60 percent.)

Net income for Q1 rose to $1 billion, up nearly 70 percent from the year-ago period.

The results blew past analysts’ estimates and had shares jumping more than $14 in after-hours trading after having fallen $4.36 to $471.65 during the regular session.

Google’s success appears in part to be coming at the expense of recently struggling Yahoo! That company, run by former Warner Bros. co-chief Terry Semel, disappointed Wall Street on Tuesday by reporting a decline in quarter-over-quarter profit. Yahoo! shares have sunk 14.3 percent since then.

Google CEO Eric Schmidt, in a conference call Thursday, stressed Google’s opportunity in foreign markets. International sales represented 47 percent of Google’s revenue in the quarter, up from 42 percent a year ago.

And while nearly all of Google’s revenue comes from the sale of Internet search advertising, Schmidt spoke of inroads Google is making into traditional media. Google has ad sales partnerships with the likes of Clear Channel Communications in radio and EchoStar Communications in television, for example.

Schmidt said that it’s the strength of Google’s core online-search business that allows the company to take risks with new products, adding, “Targeted and effective advertising continues to be our mantra.”

Sergei Brin, Google’s co-founder and president of technology, told analysts that he does not view advertising as a zero-sum game, whereby advertisers are taking money spent on traditional media in order to beef up spending on the Internet without actually increasing advertising budgets.

“That has not been our experience,” he said.

Schmidt also defended YouTube, the $1.65 billion acquisition that has content owners like Viacom upset because oftentimes its video appears there without permission.

Schmidt said such concerns ought to be muted by Google’s soon-to-come Claim Your Content, a tool that is a mechanism for proving ownership of video and for automating the take-down process.