Google said last night it saw no impact from a weakening US economy as it posted a better-than-expected quarterly profit and waved off fears of an online advertising slump.
Google's hard-hit shares surged 18 per cent above $500 - a level last seen in February - as the company showed signs of better cost control and earned more revenue abroad than at home for the first time, partly because of the weak dollar.
"It's clear to us that we're well positioned for 2008 and beyond, regardless of the business environment that we find ourselves surrounded by," chairman and chief executive Eric Schmidt told investors on a conference call.
Google's Dublin office employs more than 1,500 staff and supports customers in Europe, the Middle East and Africa.
Google, one of the hottest technology stocks of 2007, had seen its shares erase last year's 50 per cent gain since the start of 2008 on investor concerns that the online ad industry was maturing and vulnerable to a US economic downturn.
First-quarter net income rose to $1.31 billion, or $4.12 per diluted share, from $1 billion, or $3.18 per share, a year earlier. Excluding one-time items and stock option expenses, profit was $4.84 per share, comfortably ahead of the average Wall Street forecast of $4.53 on Reuters Estimates.
Gross revenue rose 42 per cent to $5.19 billion, just ahead of Wall Street targets. By contrast, Google's revenue grew at a 63 per cent rate in the same quarter a year ago.
International revenue accounted for 51 per cent of the total, surpassing US revenue for the first time and powering the company's results. Translating overseas sales into a weaker dollar helped boost Google revenue by nearly 4 per cent.
Google's performance may strengthen Yahoo in its efforts to wring a higher takeover offer from would-be buyer Microsoft.