Success in Google's profits search

IN ITS first financial report since floating, online search giant Google has revealed soaring sales. It has also stayed true to its pre-float promise to defy Wall Street convention by making no specific predictions about its financial prospects.

Sales, excluding traffic acquisition costs - revenue Google pays to its partners - rose to $503m (£277.4m), against analysts' estimates of $456 million.

At first sight, Google's net profit for the quarter of $52m was well below forecasts, but was distorted by the $201m cost of a lawsuit settlement with Yahoo! and float expenses.

In after-hours trade yesterday, investors pushed the stock up $12.12, or 8%, to $161.50. In the first few minutes of Friday's session, the shares rose more than 12% to $170.25.

Google's shares began trading on the Nasdaq exchange just two months ago at $100.01 after a rocky pre-listing period led the company eventually to price its offer at $85 per share, making founders Sergey Brin and Larry Page paper billionaires.

'We're not going to be offering future guidance today,' said chief executive Eric Schmidt, but rejected analysts' predictions that growth will slow in coming years.

Google faces new competitive challenges with giant Microsoft preparing to launch its own search engine, but has new products in the pipeline. They include taking on Yahoo! and Microsoft with an email service, and a desktop search function to quickly locate sites previously looked at on a computer.