Google posts profit +

Google's profits are up 26%, as 40m users sign up to its Google + social network. It looks like it's winning friends far faster than Facebook...

by Dave Waller
Last Updated: 14 Oct 2011
Revenues at the web search giant soared by a third to $9.7bn (£6.2bn) in the three months to 30 September, as net profits grew more than a quarter to $2.7bn. The figures beat analyst expectations and will settle investors' nerves that Google was getting carried away with its hiring – the search giant took on 2,585 staff in three months. Hasn't it heard of the economic woes? It appears depression can't make a dent on page impressions: judging from Google's figures, when you're at the top of the search game, you can't even see the downturn.

Indeed, Google's expansion suggests it's not susceptible to the same economic winds as everyone else: it has announced that more than 40m users have joined Google+ since the new social network launched in beta at the end of June. The network, which allows users to group their friends in ‘circles’, was made fully accessible to the public in late September, by which time it had already attracted more than 25m users. Compare that to arch-rival and current cool kid Facebook, which took 10 months to reach 1m users. It’ll be a difficult task even for Google to get everyone to shift across, but you never know – in the social networking house-party, Facebook may soon be left hanging out in the utility room with MySpace, as Google holds court over everyone else.

Investors certainly won't be calling for a cab any time soon either: Google’s share price surged 6% to $592.36 in after hours trading in New York. Analysts had been bracing for a slight slowdown in its growth, fearing the effect that the downturn would have had on Google’s ad revenues. These are all-important, given they’re the only way to actually make money out of winning this popularity contest. Google says that the number of paid clicks – when users click on adverts served by Google – rose by 28%. The cost per click was 5% higher than a year ago.

This will all come as good news for Larry Page, who was named Google chief exec six months ago and subsequently set about underwhelming everyone at the party by appearing to do absolutely nothing. Now even Facebook would be forced to grudgingly accept there’s a reason why everyone's flocking to him…

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