Behind Google’s Glowing Earnings

The search giant’s better-than-expected results encouraged analysts, but investors still see tough times ahead in online advertisingEven as the economy skids, Google keeps on rolling — just a little more slowly than it used to. Bucking the stalling economy and worsening outlook for online advertising, the search advertising titan on Jan. 22 reported better-than-expected fourth-quarter results. The numbers suggest Google will keep grabbing more of the online ad market from traditional media and from struggling online rivals such as Yahoo! and Microsoft.Shares of Google, which fell 56% last year, slipped almost 3% in extended trading after an initial 4% gain. Enthusiasm for the company’s fourth-quarter results was muted by questions about whether Google can keep posting solid gains as advertisers rein in spending. Investors also appeared to balk at an employee stock option exchange that will cost Google $460 million. Before the closing bell, the stock had climbed 1% to 306.50.

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