Dominant Google leads the way out of recession
Search giant posts big profits thanks to the recovery and changes in consumer behaviour
Internet giant Google has been given a shot in the arm, posting a 27 per cent jump in third-quarter profits thanks to a growth in online advertising, prompting speculation that the recession is over, for new media at least.
Google dominates the market and, as advertising budgets naturally migrate towards the web, it was widely expected to be one of the first companies to benefit once the downturn eased. Even so, its figures are impressive. It reported a net profit of $1.64bn for the third quarter, more than a quarter up on the same period last year. Revenue for the three-month period came in at $4.38bn, well ahead of analysts' forecasts of $1.29bn.
Google chief executive Eric Schmidt said: "The worst of the recession is clearly behind us. Because of what we have seen, we now have the confidence to be optimistic about our future."
Colin Gillis, senior analyst at Brigantine Advisors, said: "Google has no competition. Yahoo is withering on the vine and [Microsoft's] Bing is too tiny now."
What's more, many companies are now choosing to advertise online because they can keep tabs on their return on investment by monitoring click-through rates. The recession has also sent consumers scurrying to the web in order to hunt for bargains.
David Hallerman, an analyst with internet research firm eMarketer, says: "Search is well-positioned in a poor economy. There are a lot of companies that haven't gone out of business. They still need to get customers."
There has also been a spike in the number of searches performed on mobile phone thanks to developments in technology - which also plays into Google's hands. ·
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