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Google shares rise on strong first-quarter advertising sales

April 18, 2013|By Jessica Guynn
  • Google reported an 18% increase in profit in the first quarter compared to the same period last year, helped by strong revenue growth in its advertising business.
Google reported an 18% increase in profit in the first quarter compared… (Paul Sakuma / Associated…)

SAN FRANCISCO -- Google Inc., which for years has dominated online advertising sales on personal computers, is showing signs that it's figuring out how to make money on mobile devices, too.

Google's first-quarter profit jumped 16% as the Internet giant saw strong revenue growth in its advertising business.

Marketers have begun to pay more for ads that Google places on smartphones and tablets, the results suggest. Google has been hounded by concerns over slowing ad revenue growth on desktops as more and more people turn to smartphones and tablets to access the Web. The prices paid for clicks was down about 4%.

The average fee that Google gets for ads that run alongside search results, known as cost per click, has fallen compared with the previous year for five straight quarters. But in the first three months of this year, Google’s average ad prices decreased more slowly.

Ads on mobile devices generally fetch less, though Google says advertisers will eventually pay more to hawk their services on mobile devices. This summer Google will change the way it sells ads to nudge marketers to buy more ads on mobile devices.

Google earned $3.4 billion, or $9.94 a share, in the first quarter. That was up from $2.9 billion, or $8.75 a share, in the same period last year. Revenue rose 31% to $14 billion.

Shares Thursday rose more than 1%, or $11.24, to $777.15 in extended trading.

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