Google (NSDQ: GOOG) posted double-digit jumps in sales and net income during the third quarter, as the company continued to benefit from a strong market for search ads, as well as growth in its other businesses. Sales increased 20 percent to $5.48 billion, from $4.38 billion a year ago, while earnings per share increased to $7.64 from $5.89. On average, analysts had expected net revenue of $5.25 billion and earnings per share of $6.67, so Google easily beat expectations. Indeed, Google’s earnings per share and sales figures were greater than even the most bullish analysts had expected. That was a change from last quarter, when Google disappointed Wall Street by posting a lower-than-expected profit figure.
In its earnings announcement, Google CEO Eric Schmidt said that the company’s core search business “grew very well,” while the company’s “newer businesses — particularly display and mobile — continued to show significant momentum.”
Google reported solid growth in both paid clicks and cost-per-click. The company said paid clicks increased 16 percent during the quarter, while cost-per-click was up three percent, compared to a year ago. Overall, the company said that the revenue it generates from its owned sites and the revenue it generates through AdSense were both up 20 percent.
Google managed to post the better-than-expected profit figures, despite increasing its spending substantially. The company spent $757 million on capital expenditures during the quarter, compared to $476 million last quarter.
It also added nearly 1,200 employees, marking the fourth quarter in a row that it increased its workforce. That will not be changing. In his comments, Schmidt said, “Going forward, we remain committed to aggressive investment in both our people and our products as we pursue an innovation agenda.”