Google shares top $1,000 after strong earnings
- 18 October 2013
- From the section Business
Google shares have topped $1,000 (£617) for the first time, jumping 13.8% on Friday after the company reported better-than-expected earnings.
Shares in the online giant closed 122 points up at $1,011.4, and have risen 42% since the start of 2013.
Friday's share price rise followed the company posting a 36% jump in net profits to $2.97bn for the July-to-September period on Thursday.
Google's revenues also beat forecasts with a 12% rise year-on-year.
"We are closing in on our goal of a beautiful, simple, and intuitive experience regardless of your device," Google's chief Larry Page said in a conference call with analysts.
The strong earnings report also helped other online companies, with Facebook shares adding 4.4% to a new high of more than $55. Amazon rose 3.4%.
Google's market value is about $334bn, which is still well below Apple's $461bn.
Google was floated in August 2004 at $85 a share, giving the company a market value at the time of $23bn.
The company reported its quarterly earnings on Thursday after US markets had closed.
Google said that paid-for clicks increased by a quarter during the July-to-September period, from a year earlier, the highest rate of growth in the past year.
This offset an 8% fall in average cost-per-click, the price advertisers pay Google when consumers click on their ads.
"We view solid paid clicks growth to be a good indicator of demand, driven by the continued shift to mobile," JP Morgan analysts said in a note.
Several brokers have raised their share price target for Google on the back of the company's new initiatives to attract advertisers.
In February, the company launched a service to help advertisers market through a mix of smartphones, tablets and desktop computers. And analysts believe there is still significant potential to generate revenues from its video-streaming website YouTube.
YouTube-branded video-ads surged more than 75% in the quarter from a year earlier, with 40% of traffic now coming from mobile devices.
"We estimate that Google's key YouTube asset generated approximately $4bn in revenue in 2012, positioning Google extremely well for the strong growth in video advertising," RBC Capital Markets analysts wrote in a note.
Analysts at Jefferies said Google is best positioned to benefit from mobile devices with one billion activations of its Android system. Google sells applications and content through its Google Play store.