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NEW YORK - Web search leader Google said yesterday its quarterly profit nearly tripled to more than US$1 billion but revenue growth failed to impress investors.
Shares in Google fell as much as 3.5 per cent in extended trading after the company reported its results, though the declines were muted as executives said they would continue major investments in the business to bolster financial results.
"We're going to continue to invest significantly in capital expenses," said Google chief executive Eric Schmidt.
"Our financial results in the last couple of quarters were directly related to that 'over-investment'."
Google is deriving more revenue out of running fewer ads that are more targeted to specific audiences on the web, Schmidt said.
Growth will also be boosted by Google's growing business outside its established US and British markets, partnerships with affiliate networks and its expansion into radio, video and mobile ad formats, he said.
Google's revenue increased 67 per cent in the fourth quarter to US$3.21 billion, compared with average analysts' estimate of a 64 per cent year-on-year increase to US$3.14 billion, according to Reuters Estimates.
Revenue growth is closely watched as investors gauge Google's ability to capitalise on web advertising against rivals such as Yahoo and Microsoft.
Some analysts had predicted Google would significantly beat expectations for the quarter, with data showing it continued to gain share in search queries and on weaker growth at Yahoo.
- REUTERS
