Google shares surged in after-hours trading following better-than-expected Q3 earnings.
The company reported $5.94 billion in revenue for Q3, representing growth of 7% from Q3 2008.
Thomson Reuters predicted Google would deliver $5.42 per share, but Google reported $5.89 per share
As of 5:15 PM Eastern Time, Google's stock price had risen about 16 points (3%) in after-hours trading, erasing a Thursday market loss of about 5 points (1%) that took place as the Dow Jones Industrial Average and the NASDAQ both rose.
Google CEO Eric Schmidt in a statement said that Google had experienced a strong quarter despite tough economic conditions and suggested that the company would invest heavily in the future.
In a conference call for investors, Schmidt reiterated this point. "We're going to continue to invest in long-term growth," he said. "We're going to invest in people. We're already stepping up our hiring."
Schmidt also said that Google was looking to acquire companies both large and small. Traditionally, he said, Google has acquired about one company per month. He suggested that smaller companies that had developed innovations in search or advertising, or technologies that could help accelerate the development of Google's upcoming Chrome OS, represented the kinds of acquisitions that might be considered.
Both Schmidt and CFO Patrick Pichette said that the worst of the recession has passed.
Pichette said that YouTube would be profitable very soon. "We're monetizing more than a billion video views on YouTube every week," he said.
Google intends to invest in search and advertising. "We want to really get to the perfect search engine," said Schmidt, noting that the company had made over 120 improvements in its search engine in Q3.
Mobile search represents a significant area of growth for the company. Schmidt said that the number of mobile searches had grown by 30% during the past quarter.
Schmidt also expressed optimism about Google's Android platform, which is now available on 12 devices in 26 countries. "Android's adoption is literally about to explode," he said.
Jonathan Rosenberg, SVP of product management, said that Google's disparate local search, advertising, map, and voice products have all come together to improve the online marketing opportunities for local businesses. "Everything is now finally in place for local businesses to connect with customers online," he said.
Rosenberg said that Chrome OS development was going very well and Schmidt said that the internal demos demonstrate that it's a "materially significant" development in computing.
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