Google sees profits surge

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Search giant Google reported on Tuesday that its fourth-quarter earnings rose 101 percent year over year, exceeding analyst expectations, as revenue from advertising soared.

Net earnings for the quarter ended Dec. 31 were $204 million, or 71 cents per share, on revenue of $1.03 billion. That compares with earnings of $27 million, or 10 cents per share, on revenue of $512.2 million in the same period in 2003.

Google's income figures included a $60 million noncash, stock-based compensation charge. Without that, it would have earned 92 cents per share. Analysts surveyed by Thomson First Call estimated it would earn 77 cents per share.

For the full year, Google reported revenue of $3.19 billion. That compares with revenue of $1.47 billion in 2003.

At the close of regular trading, when the earnings report was issued, Google shares were down $3.72 to $191.90. In after-hours trading, Google shares were up more than 16 points to $208.35.

Google said the revenue growth reflected better traffic and more advertisers believing in the value of Internet search marketing.

"Google had an exceptional quarter," company CEO Eric Schmidt said in a statement. "Revenues and profits increased significantly, our execution was solid across the company, and, most importantly, our relationship with our users, partners and advertisers became even stronger."

At the end of the year, Google had cash and cash equivalents of $2.13 billion and employed 3,021 full-time staff.

The portion of revenue Google shares with its partners, or its traffic acquisition costs, was $378 million, up from $216 million in the fourth quarter of 2003.

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