SAN FRANCISCO (REUTERS) - Google Inc's quarterly results beat Wall Street's expectations as the Internet search giant expanded its mobile business while keeping ad-rate slides in check, offsetting deepening losses from Motorola.
Shares of Google rose 6 per cent to US$941.25 (S$1,170.24) in after-hours trading on Thursday after it reported a 23 per cent rise in revenue from its Internet business, excluding fees paid to partners, of US$10.8 billion in the third quarter.
"They were able to grow their revenue pretty substantially, particularly in their own websites, in spite of having lower overall ad prices," said JMP Securities analyst Ronald Josey.
Google's business, like rivals Facebook Inc and Yahoo Inc, has come under pressure as more consumers access its online services on mobile devices such as smartphones and tablets, where advertising rates are lower than on personal computers.
Paid clicks increased 26 per cent year-on-year during the three months ended Sept 30, while the average cost-per-click - the price that marketers pay Google when consumers click on their ads - decreased 8 per cent.
"That's the key story, their ad volume growth is outpacing the decline in cost-per-clicks," Mr Josey said.
On Thursday, co-founder and chief executive Larry Page told analysts he will no longer be joining the company's regular earnings conference call. He did not give a reason.
Mr Page, who with Mr Sergey Brin conceived of what is today the world's most-used Internet search engine, is not known for assiduously courting Wall Street investors. And this year, Mr Page revealed that his vocal cords are partially paralysed as the result of a rare medical condition.
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In terms of quarterly results, Google also managed to handily beat Wall Street's expectations.
It earned US$2.97 billion, or US$8.75 per share in the three months ended Sept 30, compared to US$2.18 billion, or US$6.53 per share, last year.
Excluding certain items, Google said it earned US$10.74 per share, compared to the US$10.34 that analysts were expecting, according to Thomson Reuters I/B/E/S.
Google's consolidated revenue of US$14.89 billion compared with the US$14.79 billion average analyst estimate.
Operating loss at Motorola, Google's mobile phone business, totaled US$248 million during the third quarter, compared to a loss of US$192 million in the third quarter of 2012.
