GOOGLE 1st post-IPO profit bolsters lofty share price

Google's stock price has increased from $85 to more than $150.
SAN FRANCISCO (AP) -- Google Inc. is making everyone who snubbed its unconventional initial public offering of stock regret their decision.
In the latest rebuke to its skeptics, Google wowed Wall Street with its first quarterly earnings report as a public company, propelled by a continued surge in online advertising distributed by its Internet-leading search engine.
The Mountain View-based company said Thursday that it earned $52 million, or 19 cents per share, during the three months ended in September. That compared with $20.4 million, or 8 cents per share, at the same time last year.
The quarter offered Google the first chance to demonstrate how the company held up during a much-scrutinized IPO that has turned hundreds of its employees into millionaires. Investors were so impressed with what they saw that the workers, known as "Googlers," are likely to grow even richer today.
Google released its results after the stock market closed Thursday. The company's shares climbed $8.89 to finish at $149.38 on the Nasdaq Stock Market, then soared another 8 percent, or $11.92, in extended trading.
Surprise to analysts
Google stock opened at $85 a share. Since it started trading, the stock has climbed to heights that has surprised even the most bullish analysts.
"This has probably become the ultimate momentum stock," said Janco Partners analyst Martin Pyykkonen, who believes Google's shares have become too expensive. "Still, you have to give them a high five. It was a very strong quarter."
The enthusiastic reaction reflects Google's robust revenue and earnings growth during the third quarter.
Google said it would have earned 70 cents per share, if not for charges related to stock-based employee compensation and a previously announced patent settlement with rival Yahoo Inc.
That was well above the mean estimate of 56 cents per share among analysts polled by Thomson First Call. Analyst forecasts had varied widely because Google hadn't provided any previous financial outlook and management has vowed to continue that policy.
Generating revenue
Google's revenue for the third quarter totaled $805.9 million, up from $393.3 million last year. Google generated most of the revenue -- $411.7 million -- through ads displayed on company-owned sites. That's an important factor because Google doesn't have to share the money with other advertising partners.
Subtracting the commissions Google paid to deliver ads to other Web sites, the company's third-quarter revenue would have been $503 million, topping the mean analyst estimate of $456 million, according to First Call.
"Our business is working very well," Google CEO Eric Schmidt said Thursday in an interview. "There had been a lot of concern that we would go public and our employees would become distracted. But we did the IPO and then came right back to work."
Caris & amp; Co. analyst David Garrity was pleased with Google's performance. "Companies are supposed to blow the numbers away the first quarter after an IPO and they did that, so hats off to them," he said.
Based on the latest price, Google's market value stands at $44 billion just six years after the company's inception. Co-founders Larry Page and Sergey Brin, who began developing Google's search engine in a Stanford University dorm room, are worth roughly $6 billion apiece.